Oasis Bakken Well Design Shows Large Increase In Oil Production -- Filloon -- December 18, 2017

I was wondering when Mike Filloon was going to get to Oasis; they have had some great wells. Also, now that Oasis has cracked the code on the Bakken, maybe they felt they could do the same in the Permian.

Link over at SeekingAlpha:

• OAS has shown significant improvements in production per location from 2015 to 2016 and later.
• Some improvements are due to high grading but the upside attributed to his only cover a small percentage of wells.
• Lateral lengths have not changed from 2015 to present, but production has increased by 53 KBO and natural gas production has tripled.
• OAS has difficulties ahead due to leverage but it will be interesting to see how that will translate in the Delaware Basin.

From the article:

Oasis has become a very good operator. It has kept costs down and improved production per foot significantly over the past few years. We pulled the production data of 91 Oasis locations in North Dakota completed after January 1st of 2016. Four horizontals produced over 250 KBO in 12 months of well life. Only one location was a one-mile lateral. The rest were between 9,000 and 10,700 feet.

In summary, OAS is performing very well and enhanced completions are pushing production per foot higher. The increase of 53 KBO is very good, and natural gas production has tripled. This was done with comparable lateral lengths. OAS is a risky play and a name we do not own. The Delaware purchase has been interpreted as bearish, but the geology is much better than any it currently holds.

OAS has been an excellent operator and done an excellent job keeping costs down. It will be interesting to see how this plays out in west Texas. We do not own OAS, and still think it has a difficult road ahead. The leverage is concerning, but if oil prices spike it could see significant upside. There is considerable risk going forward.