An Unedited Saturday Morning Letter (Okay, Minor Edits) -- Bakken, North Dakota, USA

This may be a bit "unprofessional" -- but that's the way blogs are supposed to be -- posting on the run. So maybe I will clean this up later, but for now, this is a "cut and paste" of something I shared with two other folks earlier this morning. But the BEXP conference call has really excited me and I want to be sure everyone gets a chance to look at it.

Quick Note Regarding the 4Q10 BEXP Earnings Conference Call

I don't think one can find anyone more excited about the Bakken than I am, but I have to admit that the BEXP presentation (earnings conference call) is incredible. BEXP has really raised the bar. I think that's the longest, most detailed conference call I have ever seen.

I don't know if I want to do it, but I might wade through it and put data points of everything that was mentioned.

I can't even begin to say what was most interesting.

But, as a start, I will say this: I said some time ago that everyone was focused on the Bakken formation, but that's just a start. It's really the other formations that will be the big story before this is all over in this sense: the producers will have sunk wells everywhere in the Williston Basin, holding leases by production. Then they will go back in (re-frack the older Bakken wells, of course) and then go after the other formations. BEXP said as much.

[By the way, Slawson is already doing this. See NDIC March hearing dockets case 14386: Slawson wants to go back into Ambush 1-31-30H and open a portion of the vertical section of the well to the Lodgepole Formation in Williams County.]

They mentioned one that the stenographer did not catch (Miscu [ph] Dubro [ph] -- That's the "Nisku-Duperow."  As you mentioned some time ago to me, the Nisku is the Birdbear. The Birdbear-Duperow sit just beneath the Bakken/Three Forks.  [The Birdbear is NOT new. I posted about the Birdbear in February, 2010, linking articles back to 2009.]

Then they mentioned the Tyler/Heath which got a lot of press back in October, 2010.  And, of course the Lodgepole, which MRO is now asking for proper spacing for in Murphy Creek, Dunn County, case 14304, NDIC March hearing dockets.

So this drilling is going to go on and on and on.

Some of these formations are shale that will require horizontal/fracturing, but in the old days they had vertical wells going into reservoirs, so I don't know if we are going to see more conventional wells or not. 

These other formations are important because it brings up the issue of EOR. Some formations are more amenable to EOR than others.

One other note. BEXP addressed the issue of whether too many wells (four or five) on a spacing unit might start to impact production from neighboring wells (overlap).  BEXP says that's fine. They are considering putting in just enough wells to start to see that impact -- if not, they would be leaving oil in the ground.

More later, but I was really, really impressed with that presentation.