New KOG Presentation

I had not looked at a KOG presentation in a long time, so I enjoyed a quick look at their presentation at the Rodman and Renshaw Annual Global Investment Council. I have not had a chance to take an-depth look at the presentation but three slides jumped out at me:

• Slide 6: significant increase in daily production coming out of the Bakken; of course, this has to be looked at in light of increased number of shares outstanding when anticipating earnings/share
• Slide 10: XOM jumps out at you as a major oil company in the Bakken; this has to impress Wall Street investors who may not understand the significance of the Bakken; of course, that is due to XOM buying XTO
• Slide 15: the difference between short laterals and long laterals

I still don't think folks understand why there is such a huge decline following the initial production number. Porosity, natural fractures, stimulated fractures, and thickness of the formation appear to be the four most important factors. I get that, but I don't understand the steep decline immediately following most of these wells. And based on an accumulation of data, it certainly appears to me that fracturing doesn't "reach out" more than 400 feet laterally, and maybe even less. That thinking may be very naive but it certainly seems that is true.