Thursday, September 8, 2011

"The Eastern Edge Is Far From Dead" -- Minot -- Lynn Helms -- NDIC -- Bakken, North Dakota, USA -- September 8, 2011

Update

Look how inexpensive some of these leases were -- see comments below -- $25/acre.

Original Post

This in an incredibly interesting story. We're starting to get a bit more insight into the northern and eastern margins of the Bakken.

In the past few weeks I have been in conversation with others regarding the margins and I have hinted at the kernel of those discussions in an earlier posting regarding the Baker Hughes "SuperSite" in Williston.

I can't go into it now, but I post this again, for the time-date stamp.

See today's story in the Minot News for comments about the Bakken pool extending farther east and farther north than accepted by general consensus. The article is in a small regional newspaper and will be seen by very, very few folks (except in hindsight). Local folks are being given a big gift with this local reporting. This may be the biggest story this month. Very, very interesting, and explains a few things.
New players are starting to drill in the margins of the Bakken-Three Forks area, said the states' top oil and gas regulator.

"There are a lot of new players coming in the Renegades, the Chesapeakes, the Devons...

"It's actually happening a little bit sooner than I thought it would be," said Helms.

"I thought we've got to get through that five years securing a leasehold time," Helms said. After that, he said he thought some of the big oil companies, naming Hess, Continental Resources and others, in the state then would move into those areas "

"Renegade Resources is really excited about this area," Helms said.

"So there are localized or maybe larger regional areas of mature source rock much lot closer to Minot straight north than [western North Dakota] ...
"The eastern edge is far from dead," Helms said.

"The Renegade well really demonstrates eastward expansion of this play into northern Ward County. It's really good news for northern Ward County and for Renville and western Bottineau (counties)," he said.
As noted above: this may be my biggest story this month.

10 comments:

  1. Bruce, the article says three-forks but I believe the Renegade well is a Bakken well (based on papers at eser.org and Renegade web site).
    It says sourced from same area meaning it's not migrated from the know thermally mature area. So the question is how big is the drilling area??

    Interestingly enough I saw another report stating an area close by in Renville as being thermally mature Bakken with natural faulting similar to Parshall!! See:

    http://www.threecrownpetroleum.com/silver.php

    "Shell drilled 2 wells in Sec 34 of 161-87 in an effort to exploit Devonian reefs of the Winnipegosis Fm. No cores or tests were conducted in the Bakken. Like the Clarion Resources well, over 20' of Middle Member Bakken was penetrated with 6' having <60API Units (see Bakken Type Log). The Upper Bakken Shale has resistivities of 1500-1800 ohms, indicating thermal maturity.
    Recurrent basement faulting is believed to be a significant factor at the Parshall field (the Van Hook Arm). In the Silver Area, the Shell wells suggest basement faulting. In Sec 15 of 160N 86W, Shell drilled a basement test in 1980. No cores or DST's of the Bakken were done, but both the Mission Canyon and the Red River cores were noted to be highly vertically fractured. The fracturing may evidence basement faulting associated with a lineament. In this well, the Middle Member of the Bakken has 8' of clean (<60API Units) Middle Member with 16' gross interval. "

    ReplyDelete
  2. I guess you bring up two issues:
    1) Bakken vs Three Forks
    2) Thermally mature Bakken farther north

    With regard to thermally mature Bakken farther north, we may know more sooner than later. Jury is still out whether going north of Minot targeting the Bakken will be economical, but it looks enticing.

    Withe regard to Bakken vs Three Forks, terminology is often confused. I've blogged about it.

    http://milliondollarway.blogspot.com/2010/02/continued-confusion-bakken-and-three.html

    There are administrative terms and there are formation terms. "Bakken Pool" includes Bakken formations as well as Three Forks formations. So, administratively, a Bakken well could include a well that targets a Three Forks formation. If you look at the hearing dockets, there is never any mention of Three Forks; it is all Bakken.

    The "Sanish" is a Three Forms formation in a geographical location near Parshall, North Dakota.

    ReplyDelete
  3. Renegade just leased land adjacent to the described area above, dirt cheap. Like $5/ac or something!!

    Page 16 of the Renegade Corp Presentation (http://www.renegadepetroleum.com/documents/presentation/RPL-2011-09-08-corppres.pdf)
    shows where they've leased.

    ReplyDelete
  4. It would be nice to see the original source or news report suggesting someone leased at $5/acre. Unless I missed it, the presentation shows only where they've leased, not what they paid.

    If $5/acre is accurate, it speaks volumes about what folks think is recoverable.

    ReplyDelete
  5. I knew it was something real low but I was off (from May 2011 http://www.land.nd.gov/minerals/AuctionHistorySale.asp):

    OG1100845 161 86 36 NW4NE4, S2NE4 120 NORTHERN ENERGY CORPORATION $25.00
    OG1100846 161 86 36 NW4 160 NORTHERN ENERGY CORPORATION $25.00
    OG1100847 161 86 36 SE4 160 NORTHERN ENERGY CORPORATION $25.00
    OG1100848 161 86 36 SW4 160 NORTHERN ENERGY CORPORATION $25.00

    Being a first mover has it's advantages...

    I've been following this because it's right above our tract which remains unleased?!

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  6. Actually you were not off by much: with what is going on right now, there is not much difference between $5 and $25 -- good catch by you.

    Thank you for taking time to write and to share.

    If the prospects there are as good as Lynn Helms is suggesting, someone is going to do very, very well.

    Great way to start the day. Thank you.

    ReplyDelete
  7. http://www.minotdailynews.com/page/content.detail/id/556969/Estimate--Oil-exploration-5-7-years-away.html

    Didn't know where else to post this. Couldn't find the "contact us" tab.

    ReplyDelete
  8. I saw this article; conscioiusly decided not to post it; too far in the future.

    But I suppose for folks not familiar with North Dakota, it would be fun to mention "mountains" and North Dakota in the same sentence.

    The story: drilling in the Turtle Mountains (of North Dakota, 5 - 7 years away).

    ReplyDelete
  9. Looks like Renegade bought the whole Silver Prospect listed here: http://www.threecrownpetroleum.com/silver.php

    according to papers at Eser.org

    I guess they're bullish on this area for Bakken, eh??

    ReplyDelete
  10. Thank you for the Three Crown Petroleum link; interesting to read, especially about the thickness of the Bakken in this area.

    Eser.org continues to be a very, very nice navigable site. Thank you for taking time to remind folks of that site.

    ReplyDelete