Thursday, November 4, 2010

KOG's 3Q10 Financial and Operating Results (Bakken, ND, USA)

Full report here.

Operations

Rigs and Acreage
  • Still a two-rig drilling program in the Williston Basin
  • Joint venture with one non-operated rig
  • Continues to acquire leasehold position in the Williston Basin
  • Purchase of 8,960 acres to date in 2010 averaged $1,600/acre
Four-well pad (three middle Bakken and one TFS well) -- should be completed by year-end
  • Two Shields Butte (TSB) 14-21-4H
  • TSB 14-21-33-16H3 (Three Forks well)
  • TSB 14-21-33-15H
  • TSB 14-21-16-2H
  • To be connected to oil, gas, and water pipelines
Two-well pad, non-operated with working interest
  • Tested both the Bakken and Three Forks
  • Bakken: 1,385
  • TFS: 1,374 
  • Evidence that Bakken and TFS are separate oil-bearing reservoirs
Four-well pad, three miles northwest of four-well pad noted above
  • TSB 2-24-12-2H
  • Skunk Creek (SC) 2-24-25-15H
  • TSB 2-24-12-1H3 (Three Forks well)
  • SC 2-24-25-16H3 (Three Forks well)
  • Grizzly Federal 1-27H-R
  • 10 stages
  • Intended for Middle Bakken; landed in Three Forks
  • Kept it there, to test TFS potential
  • IP: 447
  • Confirms productive potential of TFS in this area
Financial

Net income $361,000 3Q10 vs ($9,000) 3Q09
Zero cents/share 3Q in both 2009 and 2010
Net operating cash $8 million 3Q10 vs $5.8 million 3Q09
Cash for operations in 3Q10: $20 million
  • $18 million for drilling and completing wells
  • $2 million for leasehold acquisitions

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