EOG 1Q12 Earnings and Operations Update

$1.20 vs $0.52 1Q11 -- link here.

From the press release:

In the Williston Basin, EOG posted positive results from its first quarter operations that focused on three distinct areas. In EOG's North Dakota Core Parshall Field, the Wayzetta 156-3329H, 124-3334H and 157-2835H were drilled on 320-acre infill spacing. Completed to sales at rates of 1,393, 992 and 1,083 Bopd with 600, 300 and 300 Mcfd of rich natural gas, respectively, these Mountrail County wells, in which EOG has 51 percent to 61 percent working interest, further confirm the economics and success of infill drilling.

Additionally, production from previously drilled 640-acre offset wells in EOG's Core Parshall Field responded positively to the new downspaced completions.

In McKenzie County, 25 miles southwest of its Core Parshall Field, EOG identified potential in both the Three Forks and Bakken in the Antelope Extension area where it brought a number of wells to sales. Four Three Forks wells, the Clarks Creek 11-0706H, 13-1806H, 14-1819H and 16-0706H, were completed at initial per well rates ranging from 926 to 3,415 Bopd with 1.2 to 3.0 MMcfd of rich natural gas. In this same area, EOG completed a Bakken well, the Clarks Creek 101-1819H, at 2,320 Bopd with 1.4 MMcfd of rich natural gas. EOG has 100 percent working interest in these five McKenzie County wells. On the Montana/North Dakota border, EOG drilled and completed a series of wells in the Stateline and Diamond Point areas that include the Stateline 03-1522H and the Diamond 02-3625H, both in Roosevelt County, Montana, with production rates exceeding expectations. The wells, in which EOG has 80 percent and 93 percent working interest, respectively, were turned to sales at 994 and 1,097 Bopd and began flowing with 400 and 700 Mcfd of rich natural gas, respectively.

On the North Dakota side of the border in Williams County, the Hardscrabble 08-0409H, in which EOG has 39 percent working interest, began production at a rate of 1,693 Bopd with 600 Mcfd of rich natural gas. Recent success in the Montana/North Dakota border areas adds approximately 200 new locations to EOG's extensive Williston Basin crude oil drilling inventory. EOG is testing several different methods to increase the recovery of oil in place on its Williston Basin acreage.

Following encouraging infill drilling results from its Core Parshall Field, EOG plans to test downspaced drilling on certain parts of its Bakken Lite acreage outside the Core area later this year. Additionally, in mid-April EOG commenced two pilot Bakken waterflood projects in its Core Parshall Field to test secondary crude oil recovery methods as another viable way to improve oil recovery.

You may find the EOG discussion of the Bakken interesting to compare with the discussion elsewhere. 

I've noted this, also, in the last few months: operators are identifying new drilling locations with some of their new wells. Note: in the discussion above, EOG says they've identified an additional 200 new locations. This is the follow-on: if one drills two wells north (one in the middle Bakken and one in the Three Forks) and drills two wells south (one in the middle Bakken and one in the Three Forks), is EOG counting that as one drilling location, or four drilling location. The same goes for Hess when it drills six wells from one pad: is that one drilling location or six? I'm not sure if all the analysts know the answer. It makes a huge difference, obviously. From my perspective, 200 drilling locations could result in 800 horizontal wells. Or more. See first comment/answer. One location is one well.