Weekly Roundup – Markets still fickle

Posted by bakken

The last few weeks have been tough on investors with wild swings in both directions and an inability to predict the markets next moves. We are staying steadfast in our bullishness on both Brigham Exploration (BEXP: 0.00 N/A) and Continental Resources (CLR: 79.28 -0.11%) and expect these Bakken plays to break out in the next 3-9 months. The weekly roundup is below.

• After intense selling pressure last week,  most Bakken stocks rebounded upwards  10-15% in the last 2 trading days but most are still trading well below their 2011 highs.
• On September 26th,  Enbridge shut the 25,000-barrel-a-day Line 26, which transports oil from Berthold, North Dakota, to Steelman, Saskatchewan.  The pipeline was shut down due to a leak and there is currently no timetable to bring the pipeline back online
• Two of Whiting Oil’s (WLL: 49.50 +1.29%) wells,   Smith 34-12TFH and Lydia 21-14TFH at Lewis & Clark Completed with Initial Flow Rates of 2,939 BOE/D and 1,960 BOE/D, Respectively.     Whiting  Oil has 1,102,302 gross and 680,137 net acres in the Bakken/Three Forks region.

• Hess Corp (HES.N) Chief Executive John Hess believes oil output from shale prospects in unconventional sources from North Dakota to Texas could reach 1.5 million to 2 million barrels-per-day (bpd) in the coming five to seven years, twice as much as the 700,000 bpd currently produced in these places.

In looking at the major players in the region,  Northern Oil & Gas was the only one to end up net positive after a week of brutal selling as a result of increased production.   Hopefully the remaining players can follow suite as the market recovers in the short term.

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Bakken happenings

Posted by bakkenexpert

The news from the Bakken region seems to be accelerating due to the uptick in activity.  Some pertinent tidbits are below:

• A joint venture between Resolute Energy Partners and GeoResources was announced, to develop acreage in the Bakken Shale Trend, North Dakota, US. Resolute will hold a 45% interest in the joint venture, while GeoResources will hold another 45% interest and the remaining 10% will be held by a third industry partner.
• Resolute Energy Corporation announced 2009 year end figures. Total proved oil and gas reserves were 64.4 million barrels of oil equivalent, 31% more than in 2008. Net production was 2.7 million barrels of oil equivalent, 4% down on last year It plans to put aside $22 – $25 million for acquisition and operations in its new leasehold position in Williams County, North Dakota.
• The Bakken lease sale for February in North Dakota raised $47 million, which was the second highest figure on record. The two highest bids were for Mountrail County land and the Burke County leased the most acres at 11,977.
• Brigham Exploration’s16-9 #1H well in the Bakken region produced 2,264 BOEPD at its initial rate.
• PetroBakken now has 51 bilateral horizontal wells on production in Saskatchewan, which are proving to be 50% more efficient, production-wise, compared to conventionally drilled wells.
• TransCanada Corp. met with two governors and Montana and North Dakota oil producers to discuss a possible on ramp to the Keystone XL pipeline, which could happen by 2013.

March 4^th

• One Exploration drilled 3 (0.9 net) horizontal wells in Q1 of 2010 at Tableland, Saskatchewan. They plan to drill another well there, also targeting the Sanish-Three Forks formation.
• Credo Petroleum Corporation continued to acquire acreage in North Dakota. Their first well was completed with an initial production rate of 1,474 barrels of oil per day equivalent. A second well should spud in about two months. They have 9 other wells in the area immediately surrounding these two.

March 3^rd

• Enbridge, which has already spent $223 million upgrading its North Dakota pipeline system is consider spending nearly $300 million more to increase capacity.

March 1^st

• Quicksilver Resources Q4 2009 net income was up 19% from the same period in 2008. They have over 130,000 acres in Montana and are planning to drill 2 horizontal wells to test the Bakken and other formations. The fact they will reach the Bakken at a depth of between 3,000 and 4,000 feet is of great interest as far as the economics of drilling there goes.

• American Oil & Gas Inc. is selling off other assets to focus on the development of their Goliath project area in the Bakken formation

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