Wednesday, February 7, 2018

Oasis Presentation -- January, 2018

Link here.

Two plays: the Permian and the Bakken. Highlights that I have posted here are mostly on the Bakken; see the link for everything, including the Permian.
  • Oasis says it still has 518,000 net acres in the Williston Basin; pending acquisition of 20,000 acres in the Delaware (Permian); I assume this number will decrease once sale of non-core assets in the Williston Basin is closed
  • my estimate: $500 million in non-core asset sales / $5,000 acre = 1 million acres ("Montana"?; maybe some Foreman Butte)
  • Williston: > 90% held by production 
  • 1,614 location economic at $45 WTI in the Williston
    • 770 core locations: 1/3 in Wild Basin
    • equates to more than 20 years of remaining highly economic Williston inventory at 2017 pace of completions
    • further upside with increasing frack intensity in all three areas
  • over 600 core Delaware locations
  • active rigs: 5 in Williston; 1 in Delaware
  • Williston:
    • core: north-central McKenzie, south-central Williams straddling the river -- Indian Hills (1 rig); Alger (2 rigs); Wild Basin (2 rigs)
    • extended core: north into west Williams and west into Montana, mostly Roosevelt, some Richland -- Montana, Painted Woods, Red Bank
    • fairway: farther west -- into west McKenzie and along Montana (Roosevelt)/ND (Williams state line; and then huge fairway parcel in Mountrail/Burke -- Cottonwood, Foreman Butte, Montana
  • drilling time: decreased from 22 days (2014) to 14 days (2017) -- spud to rig release
  • frack efficiencies with large pad development around zipper fracks
  • production, November:
    • Williston: 72,000 boepd
      • increasing guidance form 69 - 72 to 71 - 73 thousand boepd for 4Q17 
    • Delaware: 3,500 boepd
  • Other revenue streams
    • Oasis Midstream
    • Oasis Well Services -- currently two fracking spreads in Williston
  • 2018 development  plans
    • 5 rigs
    • complete 100 - 120 operated wells; about 70% working interest
  • cost, slickwater well costs: 
    • 2014: $10.6 million
    • 2017: 4 million lbs: $6.8 million 
    • 2017: 10 million lbs: $7.7 million
  • targeting $500 million of non-core asset sales in 2018
From the presentation, the Bakken play:

Now, this -- this is absolutely incredible: when we first started covering the Bakken, the EUR for Bakken wells were said to be 350,000 bbls (oil/oil equivalent?)

Then we saw guys like Mike Filloon / Richard Zeits (I forget which) was the first to notice EOG wells with EURs of 750,000 and then as high as one million bbls (again, oil/oil equivalent). Now, look at the Oasis type curve below -- 1.550 million boe and for some folks, an even more important data point: at 350 days, the type curves show a jump from 200,000 boe to 300,000 boe. I may be misreading the graphic a bit, but you can see it here and/or go to the source.

Now, this: the USGS bases its reserves assessments in a given basin based on production of existing wells. The last USGS survey of the Bakken was accomplished in 2013; and there results would have been based on entirely different well type curves, probably in the realm of EURs of 500,000, or a third of what Oasis is showing in this slide (yes, I am aware of tier 1, tier 2, tier 3 locations in the Bakken).

Disclaimer: in a long note like this there will typographical and factual errors. In my notes above, I will interject my comments (facts and opinions). It is difficult to tell where I may have interjected my own comments. I often make simple errors. I often misread things. I correct obvious errors when I see them. Do not make any investment, financial, job, travel, or relationship decisions based on anything you read here or think you may have read here. If this is important to you, go to the source.

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