Williams (WMB) Completes Bakken Purchase -- Bakken, North Dakota, USA

Update

June 27, 2011: Dakota-3 LLC is a subsidiary of WMB.

Original Post

Link here.

Reported earlier, but I think this is first time that I saw the seller listed as Dakota-3 LLC.

Maybe it was there the first time, and I just forgot. Yes, here it is, my original posting on this purchase, and at the time, the seller was listed as "private." The acreage represents seven (7) percent of the Fort Berthold Indian Reservation.

Anyway, 85,800 acres and assets for $925 million cash. Assets include three rigs; Williams plans to have six rigs by end of 2012. Acreage alone, that works out to about $11,000/acre -- but of course the assets have to be considered. But $11,000/acre is in the ballpark of $5,000 to $12,000/acre in this part of the Bakken.

Coastal Caribbean has about 8,000 acres in this part of the Bakken and market cap for that company is $3 million. I'm doing this from memory, so I could be wrong. Update: I am wrong; see comments below. An undated Coastal website says it has 8,000 acres in North Dakota (well down from the 25,000 acres it said it had in 2005; in addition, other than saying the acreage is in southwestern North Dakota, I have no additional information where it may be located. If I remember, I will remove this entire paragraph in a few days since it has nothing to do with the Williams acquisition.

(So, the obvious question is: who was backing Dakota-3 LLC to begin with? Williams?)

Four (4) New Permits -- North Dakota, USA

Producers: Oasis, BEXP, SM, XTO

Fields: Bull Butte, Todd, Heart Butte and West Ambrose

EU Seeks Answers On Snow Nightmare -- Not a Bakken Story

That's the headline: EU Seeks Answers For Snow Nightmare

I can't make this stuff up. As expected "they" are blaming the current snowstorm and record cold spell on global warming -- too much water vapor (not CO2 this time). Water vapor is a much bigger component of greenhouse gases than CO2.

The snow nightmare is not unexpected. When governments spend a decade planning for global warming while failing to prepare for a more likely scenario, this is not a surprise. Anyone with a Farmer's Almanac would have known that winter storms would be a bigger issue than global warming. Sort of reminds me of the fable of the ant and the grasshopper.

Just saying.

For Newbies and Investors: The Record Snow In Bakken Country Will Impact Production Targets -- North Dakota, USA

The fourth quarter production numbers are not going to look good. More on this later, perhaps, but I've opined about it earlier -- within the last day or so.

It's hard to say how these production numbers will affect share price. Share prices are moving up with price of oil and with expectation that proved reserves will continue to increase.

Share prices will move down if investors do not understand the reason for the impact is due to a temporary event.

My hunch: there may be a buying opportunity in January/February for those interested in investing in the Bakken. Just a hunch.

If someone wants to understand how production numbers can throw a wrench in one's investing plans, look at what happened to WHX in the third quarter when production numbers were not met due to closed Enbridge pipeline following a spill. EOG took a shellacking, also, but for different reasons.

I think the oil spill actually helped WHX in the long run; that's a trust and will end when it sells a pre-determined amount of oil. Oil was selling for significantly less this summer when the spill occurred than now. I assume most oil is sold on contract, so it may not have amounted to a hill of beans, or a cup of oil, but just a random thought, while I'm rambling.

Another One To Watch -- In Renville County

More on this later, but this one is yet another well to watch.

• 19472, Renegade, A Trout 6H 3-14

Important well; one of first wells in this area this boom

See comments below for update.

I follow Renegade at this page: http://milliondollarway.blogspot.com/2009/10/bakken-other-producers.html.
At some point, Renegade may get its own page. Smile.

Keeping Track of the Lodgepole -- This May Be Something to Watch

This is for my benefit only.

This may be an interesting thread before it's over regarding the Lodgepole.

The Traxell well in 31-146-89.

Several Nice Wells Reported Today -- Bakken, North Dakota, USA

Link here.

BEXP Reports Another Nice Well: Smith Farm 23-14 1-H -- Bakken, North Dakota, USA

Say what you want about BEXP and their IPs, but the company is, if anything, consistent and predictable. In a field I can't recall seeing another well in this current boom, BEXP reports an IP of 1,721 bbls (24-hour max flowback, no doubt) from the Smith Farm 23-14 1-H well in Cow Creek Field.

The iPad -- Not a Bakken Story

I'm still in bed, blogging and reading e-mail for the past two hours on my iPad. I got so absorbed in those two tasks, I forgot all about the scores of apps, plus all the books that are free for downloading.

It truly is incredible. I do not own any shares in AAPL but I love their products.

I may just stay in bed all day; it continues to rain in sunny southern California.

More on my thoughts on the iPad and urban living at this site.

It appears to me that more and more YouTube videos now play on the iPad. That did not seem to be the case earlier.

Snow Record in the Heart of the Bakken

CBS says Williston, with 26.4 inches of snow so far in December, has just set a new December record ... drum roll ... there are still eleven days left in the month.

This will slow production in the Bakken. Fracking and takeaway will be significantly impacted. Seventy-five percent of oil is trucked from the pads in North Dakota. And, of course, it takes scores of water trucks to frac a well.

An Inconvenient Truth: A Mini Ice Age is Coming -- Not a Bakken Story

Here's the link.

BLM Sees Little Environmental Impact With Gas Drilling -- Not a Bakken Story

Well, this is refreshing news, for once.

The Heart of the Bakken to Host the 2013 and 2016 Babe Ruth World Series

This is huge.

Here's the link.

$89.56: We're Not Going to Hit $90 Today But It Will Be Close

This is very, very interesting. I'm on the road so I don't have access to CNBC, but I assume the "talking heads" all agree that the fundamentals don't support this price and it's all being driven by speculators.

Yup. 1 billion speculators in China who all want to own cars.

I assume the moratoria on off-shore drilling in the Gulf, off Alaska, off the East coast, and off the West coast are still in place, along with all those lost jobs or potential oil industry jobs.

Update: I was wrong. "We" did hit $90. $90.02 to be exact. Incredible.

And from Rigzone: oil hits 2-year high.

Acreage By Producer in The Bakken -- North Dakota

With Hess adding 85,000 net acres with acquisition of American Oil and Gas, folks may be interested in number of acres held by producers in the Bakken.

This link is helpful.

Hess Closes Deal On American Oil and Gas

Here's the link.

Hess adds 85,000 net acres in the ND Bakken.

AEZ shareholders were to get 0.1373 HES shares for each AEZ share which brings the deal to about #10.40/share for AEZ shareholders. The last price I saw on Yahoo!Financial was $10.20.