Update on OXY USA OPs in the Bakken -- Why The Interest in the Man-Camp in Dickinson't -- Bakken, North Dakota, USA

Updates at "OXY in the Bakken."

Original Post

I think the dots are starting to connect. Look at the most recent OXY USA presentation, May 25, 2011. Go to slide 28 to look at OXY's prospects in North Dakota and it explains why there is interest in a 600-bed man-camp in Dickinson't.

Three takeaways from this post:

• For investors, OXY looks like a great long-term play
• For "bragging rights: North Dakota may overtake Alaska and California in daily production sometime during the next six months; but that won't be long-lived, if California production gets moving, which it appears to be doing
• For better understanding of what is going on in southwest Dunn County to cause all the commotion about a proposed man-camp

OXY USA (Bakken notes):

• > 200,000 net acres in the Bakken (corporate presentation, May 25, 2011)
• Occidental bought Anschutz Bakken acreage in late 2010 (180,000 net acres)
• Prior to the acquisition, held 20,000 acres (by my reckoning -- I could be wrong)
• 8 rigs in the Bakken (May 25, 2011); plans to increase to 12 by end of 2011
• Original holdings: South Coteau in southeastern Burke County
• Anschutz acquisition: Russian Creek, southwest Dunn county (slide 28 of May 25, 2011 presentation)

According to Teegue's link:

• OXY USA's Bakken leasehold collection point: 10 miles west of Manning
• In Cabernet field: a 20 acre industrial park: oil collection point; salt water disposal
• Will connect to the new Bridger pipeline already there

Geography:

• Manning is 25 miles almost due north of Dickinson't on ND state highway 22
• The center of OXY's play in Dunn County is about 34 miles north of Dickinson't
• Three big oil fields in this area: Murphy Creek, Cabernet, and Fayette;
• Little Knife is just to the west and it looks like OXY has interests there
• Manning field is south of Fayette, and Russian Creek is south of Manning

May 25, 2011, Presentation

• Ops worldwide; Bakken is NOT their focus
• American focus: California, Eagle Ford (60% of OXY's value in Permian Basin; 34% in California)
• Overseas focus: Iraq, Oman, UAE
• Largest acreage holder in California; 1.6 million acres; majority net mineral acres
• Slide 22 is particularly interesting: direct comparison of three unconventional shale plays -- Bakken, California, and Eagle Ford
• Depth: varies but Bakken and Eagle Ford about 10,000 (+/- 3,000); California -- 3,500 to 16,000 feet
• Thickness: whereas thickness in Bakken and Eagle Ford  comparitively thin (20 - 100 feet in the Bakken; 75 to 300 feet in Eagle Ford), some seams are extraordinarily thick in California (500 feet to 3,500 feet). Note the "thinnest" California seam is five times the thickness of the thickest Bakken seam
• OXY has almost 1.6 million net acres in California; compare to CLR's 800,000 acres in the Bakken
• Porosity and permeability in the California shale exceeds that in North Dakota by significant amount
• TOC (total organic content): compares favorably with the Bakken; better than Eagle Ford
• Average EUR: up to 700,000 boe; 10-acre spacing
• Within 10 years, California shale could become OXY's largest business unit

Permitting in California is the problem, but "Governor Brown has been working to speed up the permitting process." OXY expects the governor's efforts to be successful.

For overview of California prospects by another company, this is a start.