Saturday, February 5, 2011

Marathon Oil: To Drill Up to 145 Wells in Williston Basin in 2011 -- $1 Billion Investment -- North Dakota, USA

Updates

June 17, 2013: Tyler Formation well information is released; Rundle Trust 21-29TH

December 12, 2013: unsolicited e-mail from a reader --
I am a land owner/mineral owner in Dunn county. I have been hearing for some time that OXY has sold out some, most or all of their working interests in North Dakota. It's starting to look like these rumors might actually be true, OXY hasn't been issued any new drilling permits recently and they are trying do complete a great deal of wells by years end. Recently they have been modifying certain valves at the well sites in a way that is very similar to the way Marathon prefers operations to be set up. Have you heard anything about the sale of OXY?
September 19, 2013: MRO presentation at UBS Global Gas and Oil Conference, Houston
 
July 13, 2012: MRO -- 30-stage fractures now the norm

January 27, 2012: Marathon to increase dividend to 17 cents/share

November 29, 2011: Marathon Petroleum Company (MPC) is cheap -- SeekingAlpha.com.

July 31, 2011: MRO will re-frack 18 Bakken wells in 2011

July 26, 201l: Archived investing stories on MRO up to the date.

July 1, 2011: Effective this date, MRO (upstream) split from MPC (downstream)

Original Post
Link here.

Marathon Oil will significantly increase its exploration and production program in 2011.

Marathon Oil's 2011 CAPEX of $5.3 billion will include up to 145 wells to be drilled in the Bakken in North Dakota.

Back-of-the-envelope calculations: 145 wells x $6.5 million/well = $942 million, which can be rounded to $1 billion.  In comparison, MRO will spend a third of that ($300 million) on oil sands in Canada.

Interestingly enough, all this activity won't increase production all that much in the short term. In 2010, MRO produced 390,000 boepd on average; it is estimated that MRO will produce no more than 400,000 boepd in 2011, and could even drop to 380,000 boepd.

MRO has 385,000 net acres in the North Dakota Bakken.

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