Mike Filloon Has Nice Update Re: KOG 3Q11 -- For Investors -- The Bakken, North Dakota, USA

Link here.

Some months ago, maybe two years ago, there was a lot of discussion about the "inflation" of IPs. Over time, it appears that most operators in the Bakken have come to terms with reporting IPs and it appears that most use similar methods. My hunch is that we are closer to being able to compare IPs among different operators.

Also, some time ago, some folks were starting to opine that IPs correlated with EURs: that is, the better the initial production (IP) number, the higher the estimated ultimate recovery (EUR). Of course, the jury is still out on that, and we won't know for many years.

However, Mike Filloon in the link above does write:

For those unfamiliar with initial production rates, the further out in days, the more accurate an estimated ultimate recovery. EURs basically are an estimated amount of resource believed to be pulled from the well over its lifetime.

Mike goes on to write:

Brigham not only had better IP rates than Whiting  and EOG Resources , but had better long-term rates as well. Because of Brigham's results, its wells are the best suited for comparison to Kodiak's Koala wells. I chose wells that had very high IP rates in Brigham's Roughrider, because of this it had a higher average than Kodiak by more than a thousand Boe/d. When the 60-day IP rate is used for those same wells, Kodiak produces more than a hundred Boe/d, than Brigham's. Those hundred barrels of oil equivalent per day over sixty days produce over six thousand barrels more than some of the best Brigham Roughrider wells. 

This is not an investment site. See disclaimer on the sidebar on the right. I accumulate shares in companies operating in the Bakken to include but not limited to KOG, WLL, and EOG, but am not planning on buying any more shares for the next several months. All my discretionary income is going to my granddaughters, daughters, and wife; not necessarily in that order.

I have not kept up as closely with the numbers as Mike has, but it's been my impression that Newfield, Oasis, and KOG consistently have some great wells. MRO has made a huge improvement in IPs over the past year. Slawson (privately held) has always had great wells. NOG partners with some of the best operators in the Bakken.

By the way, Mike references the best IP rate reported in the Bakken: the Tarpon Federal 21-4H, a Whiting Petroleum operated well that had a 24-hour initial production (IP) rate of 7,009 barrels of oil equivalent (BOE), setting a new Williston Basin record for a Bakken well. This is just to the northeast of Poe (KOG's Koala prospect) Field, only separated by Camp and Banks fields.