Motley Fool Comments On SandRidge

From Motley Fool:

For SandRidge Energy, that pay has come from the Mississippi Lime formation. However, the company has really only been scratching the surface of that play. It turns out the company is quite possibly sitting on more areas of pay than previously thought.

SandRidge is now exploring the other zones in and around the part of the Mississippian that it has primarily been targeting. The initial tests of those additional zones have produced some really encouraging results. This stacked pay potential actually encompasses up to five zones in total over much of SandRidge's acreage. That could materially increase the resource potential, meaning that the acreage the company holds could be much more valuable.

In the slide below from a recent investor presentation, SandRidge lays out the advantages of having these stacked pay zones as well as its current development plans. It also has a nice schematic to visually show what this looks like. (See linked article.)

And more:

There are a couple of items investors should take note of. First, the initial results of the Middle Mississippian wells are nearly double the company's current overall initial production rate average of 377 barrels of oil equivalent per day. Further, the real game changer is that SandRidge could drill these wells while utilizing its existing infrastructure, which would really improve overall returns.

That means that SandRidge's infrastructure is even more of a competitive advantage when adding in its stacked pay potential. It would yield an even greater rate of return for the $140 million invested in electrical infrastructure as well as the $530 million invested to drill salt water disposal wells. Bottom line here, if SandRidge can prove the potential of these additional zones it will add significant value to the company.

Much more information at the linked article. 

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you may have read here. I follow SandRidge for a number of reasons, partly because it has a stacked play like the Bakken.