Bakken: Ripe for Merger and Acquisition (Bakken, ND, USA)

I've posted this before, I believe, but worthy of re-posting again during earnings season. 

Great article on the Bakken by Reuters, dateline Bangalore, October 11, 2010.

Among the unconventional shales, or tight rock formations, Bakken has the highest crude oil content, prompting analysts and industry experts to predict an M&A windfall for the region that straddles North Dakota, Montana and Saskatchewan.

The obstacle: high valuation.

Analysts, however, say valuation is a primary factor keeping buyers away. Pure-play Bakken producers are overpriced, they say.

"Any type of transaction would be too expensive a reach if someone is attempting a buyout. It would be just too expensive a proposition," says one analyst.

For example; Brigham Exploration Company trades at 74 times its forecast earnings for this year.

I was reminded of this Reuters story after KOG's recent acquisition of more acreage in the Bakken.  "High valuation" is in the eye of the beholder, I guess.