$40,000 / Acre (Permian) Vs $4,000 / Acre (Bakken) -- Enerplus / Hess -- April 8, 2021

Updates

December 10, 2021: Enerplus renews four "Hess" permits in this field. 

Hess press release:

At the time I missed the press release from Hess which was much more informative than the news reports. This is additional information not previously noted on the blog:

Hess Corporation announced today that it has entered into an agreement to sell its Little Knife and Murphy Creek acreage interests in the Bakken in North Dakota to Enerplus Corporation for a total consideration of $312 million, effective March 1, 2021.

The sale consists of approximately 78,700 net acres, which are located in the southernmost portion of Hess’ Bakken position and not connected to Hess Midstream infrastructure. Net production from this acreage averaged 4,500 barrels of oil equivalent per day net to Hess in the first quarter of 2021.

"The Bakken is a core asset in our company’s portfolio," CEO John Hess said. "Sale of the Little Knife and Murphy Creek acreage – the majority of which we were not planning to drill before 2026 – brings material value forward and further strengthens our cash and liquidity position."

The sale is expected to close in May 2021, subject to customary closing conditions.

A reader provided this link regarding Hess and Guyana.  

Original Post

Enerplus to acquire a bit of Hess acreage in the Bakken, a "bolt-on" acquisition. Link here and here. Data points, some numbers rounded:

• seller: Hess Corp
• buyer: Enerplus
• value: $312 million
• net acres: 78,700 net acres, Dunn County
• 110 net tier one undrilled locations (77% operated)
• adjacent to its current core Bakken acreage
• 6,000 boepd
• largely undeveloped land
• drilling program projection
  
• will expand Enerplus' drilling inventory by two to three years
• Enerplus says it will have ten years of drilling activity
• quality acres
• in addition to these tier one locations, the acquisition also includes 120 net operated undrilled locations which are economic based on current crude oil prices
• adds to Enerplus' five-year plan to modestly grow production
• Enerplus raised its output guidance:
• previous: 108,000 boepd
• new: 115,000 boepd
• partly due to higher-than-expected production in Pennsylvania's Marcellus region
• CAPEX raised slightly:
• previous: $350 million;
• now: $400 million
• Hess had not planned to drill this acreage until 2026.

Much more at the second link. 

Back-of-the-envelope: $312 million / 78,700 acres = $4,000 / acre.

Neither link mentioned whether acreage was federal or BLM (Ft Berthold Reservation) -- unless I missed it, but based on the graphic at the Enerplus press release, it appears that whereas much of Enerplus acreage is inside the reservation, none of the acquired Hess acreage is inside the reservation. If this is important to you, go to the source. I could be wrong on this.  

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