Monday, March 8, 2010

The News Keeps Coming: Now Its AEZ Committed to the Bakken

American Oil and Gas will sell all of its holdings in the Powder River Basin, Wyoming, for $44 million and will focus on the Bakken and the Three Forks Sanish in North Dakota.

American Oil and Gas is getting ready to spud Summerfield 15-15H, file # 18725, in Bear Creek oil field, about nine (9) miles due west of southern edge of the Fort Berthold Indian Reservation. The Summerfield is just one-half  mile away from the Hawkinson 1-22H, file # 18275. The Summerfield is in section 15 and the Hawkinson (CLR) is just across the section line in section 22, the Oakdale oil field.

The Summerfield is the third American well currently on the confidential list in the Bakken. The other two are the Ron Viall 1-25H and the Tong Trust.

Thank you to folks on Bakken Shale Discussion Group for bringing this to our attention.

101

This morning we hit the century mark, with 100 active rigs in North Dakota.

Today, at close of business, we increased that number by one, and we are now at 101 active rigs in North Dakota.

We are in uncharted territory now, folks.

The honor for the 101st well goes to EOG.

The rig is DHS 12. EOG spudded Kandiyohi 2-20H in Burke County, file # 18554 earlier today. Obviously the rig was in North Dakota prior to today, but this is the rig, when it began drilling, that put us over 100.

Interestingly enough, the Kandiyohi 2-20H is a wildcat, right on the edge of the northernmost section of the Clear Water field.

Update: actually I'm wrong on this. Although it is accurate that DHS 12 spudded yesterday, in fact there are nine (9) wells that are moving in and rigging up; one cannot tell by looking at NDIC's "daily activity report" which is the newest rig moving in and rigging up (MIRU), unless one tracks the names of the rigs every day, which I don't. Rigs in MIRU status are counted as active rigs.

North Dakota is #1 in Honey Production

North Dakota is the number one (#1) producer of honey for the sixth year in a row! North Dakota and California vie for this honor every year, but this is the first year in memory (first year ever?) that California slipped out of 2nd place. California was taken over by South Dakota, which is now #2 in production, behind North Dakota. The race was not even close.

North Dakota: 35 million pounds.
South Dakota: 17 million pounds.
California: 11 million pounds.

Hidden Gem in a Ho-Hum News Story

News story on the Bakken oil conference in Bismarck, ND.

I would not have posted this as a stand-alone post except for one thing.

Click on the link above and read the story.

See if you see anything there that catches your eye.

Hint: search "Birdbear."

Yup. There was nothing new in this story, except when the reporter mentioned three formations that are attracting attention: the Bakken, the Three Forks Sanish, and the Birdbear.

I recently posted a very successful re-entry well into the Birdbear.

Is there more to the story? Something tells me this reference to the Birdbear is a big deal.

But, then, of course, I am irrationally exuberant when it comes to the Bakken.

By the way, if you can't get excited about the Bakken after reading NOG's press release today, then I don't think anything will get you excited.

NOG: Highlights - 2009 Annual Report

NOG PR, March 8, 2010: Fiscal Year 2009 Earnings
2009 Earnings, 2009 vs 2008
2009: net earnings of $2.8 million on oil and natural gas sales of $15  million
2008: net earnings of $2.4 million on oil and natural gas sales of $3.5 million
Wasn't price of oil higher in 2008? If so, the 2009 numbers are even more impressive
Reserves
2009: 6 million barrels boe proved reserves
2009: 700% increase over 2008 proved reserves
2009: 2,065% replacement of 2009 production
Those numbers were based on SEC pricing parameters of $53/bbl
Using constant realized net prices of $72/bbl, proved reserves jump to 10 million boe 
Production
2009: 282K boe
2008: 51K boe
Results represent a 448% increase in production
Net wells
2009: 9 wells; producing approximatley 1,508 boepd
As of March 1, 2010, NOG has completed or is completing an addition 3.45 net wells with approximately 1,986 boepd
Slawson wells that NOG participated in, names and 20-day production rates:
Stallion 1-1-12H: 1,525
Zephyr 1-36H: 1,245
Ripper 1-22H: 975 (2,369)
Minx 1-28H: 923
Fox 1-28H: 1,139
Bazooka 1-20H: 1,042
Other wells NOG participated in:
Highland 1-9H (Sinclair Oil): 564
Edwards 5992 44-10 (Oasis Petroleium): 478
Van Hook 100-15H TFS (EOG): 1,585
Liffrig 29-20 1-H TFS (BEXP): 2,477
Norman 1-9H (CLR): 1,366
Arvid 2-34H (CLR): 407
For more, go to NOG's press release, March 8, 2010
Note: IPs will vary depending on who is reporting

100

March 8, 2010: 100 active rigs in North Dakota.

The honor goes to BEXP, which started drilling Sedlacek Trust 33-4 #1-H, Lot 2 33-152N-104W, McKenzie County, file #18587.  Obviously the rig was already rigging up before today, but today is the start date of this well, the day that NDIC records 100 active rigs in North Dakota.

Update: actually I'm wrong on this. Although it is accurate that this well was spudded yesterday, in fact there are several that are moving in and rigging up; one cannot tell by looking at NDIC's "daily activity report" which is the newest rig moving in and rigging up (MIRU), unless one tracks the names of the rigs every day, which I don't. Rigs in MIRU status are counted as active rigs.

Having said that, BEXP did start drilling the Sedlacek Trust well yesterday.

February Lease Sale: 2nd Highest in History

The new week starts with exciting news. The February North Dakota state land lease sale was the second (2nd) highest in history: $47 million. The highest was the previous sale, back in November, 2009, when $71 million was paid by bidders for Bakken leases.

I don't have time right now, but I have to confirm this. When inflation is taken into account, I believe a sale back in the 80's might be the second highest (or possibly, even the highest). Regardless, this is quite notable, four years into the current North Dakota boom and almost ten years into the Bakken boom.