New Well Announced For The Alberta Bakken (Northwest Montana) -- Not The Williston Basin Bakken -- October, 6, 2014

CNN.Money is reporting:

Super Nova Petroleum Corp. reports that it has received information from the management of Augusta Exploration LLCthat the preparation to drill Augusta - Krone Bakken Formation well is complete. 

The well-pad and road has been built, inspected and approved. Montana Board of Oil and Gas has approved and permitted the well. The funds required for the drilling has been deposited in escrow to FX Drilling Co Inc. Subject to weather conditions, the drilling rig will be rigged up by Friday, October 10th, 2014.

This well is located approximately 3-4 miles from Super Nova's Milford Colony land, with its recently drilled BNV Eagle #1 Well, as reported on Oct. 1st, 2014.

The well to be drilled by Augusta is in very close proximity to the historic 1962 Shell Krone Well, which encountered the Bakken formation at approximately 7,000 feet.

Note: this is the Alberta Bakken, northwest Montana, not the Williston Basin Bakken.

This press release provides much more detailed information, dated July 24, 2014. 

Background from that linked story:

The Bakken oil boom began with Elm Coulee oilfield on the Eastern side of Montana in 2000, when Lyco Energy Resources re-entered nine old wells and completed them in the Bakken formation.

In 2006, the Parshall oilfield in North Dakota was discovered by observing an old well log in that area that had Bakken formation which looked very similar to the Elm Coulee logs. North Dakota has since produced 813 MM barrels of oil from the Bakken formation through December of 2013.

The emerging Alberta Bakken play extends from Canada down through the Western side of Montana to where the company has its leased lands. The prolific Williston Basin Bakken play was the Eastern side of a shallow sea. The currently emerging Alberta Basin Bakken play was the Western side of that same sea.

The Shell Krone well was drilled in 1962, before the so called Shale Revolution of the last decade. Thus, while encountered and logged in 1962 by Shell, the Bakken formation was simply ignored then, despite cuttings of the rock showing oil. With the application of modern drilling and completion techniques, the upcoming well may prove the viability of the Southern portion of the Alberta Bakken play.

Just How Good Is the Bakken? The Alberta Basin Bakken, In This Case

Remember this post? Just How Good Is The Bakken?

TOC of typical source rock is 1% or less.

The Williston Basin Bakken has a TOC of 11%.

There is a Bakken that has a TOC of 17%.

Routine core analysis has been completed on four of the six wells to-date. Porosity up to 10.4% and non-fractured permeability up to 0.3mD (millidarcy) have been reported. Geochemical analyses have been completed on select samples with additional analysis in progress. Sample analyses indicate a thermally mature Bakken System source rock in the oil window, with some zones where TOC (total organic content) reaches up to 17%.

And where would that Bakken be, you ask?

The Southern Alberta Basin Bakken Fairway in NW Montana.

I posted this link some time ago, but had not paid attention to this particular story until Don sent it to me a few minutes ago. Thank you.

Seaway Pipeline Reversal Scheduled for May 17 -- Will We See WTI-Brent Spread Narrow?

Link here to WSJ.

It is the biggest question in the global crude-oil market: When will the gap between U.S. and European oil prices shrink back to normal? It also is one of the biggest trades.

Traders have been homing in an unusually large gulf between prices of the benchmark U.S. oil contract, known as West Texas Intermediate, and the European benchmark, known as Brent. Usually the two oil contracts trade within a few dollars of each other. But for more than a year, they have diverged widely.
Currently, Brent trades at $111.57 a barrel, $16.79 above WTI's price of $94.78. Since January 2011, the gap has been as wide as $27.88, but as recently as December it was below $8.

Now traders are seizing on signs that this spread could soon shrink. Industry experts say a new pipeline scheduled to come online in the U.S. this week is likely to help reduce a glut of oil in the Midwest. But opinions vary on how much—or even whether—the planned opening of the Seaway pipeline on May 17 will help drive up WTI prices and narrow the gap between the two oil prices. 

For the Bakken there are at least three spreads: a) WTI-Brent; b) Bakken-WTI; and, c) Bakken-Brent, though the third can be calculated from the first two.

Primary Petroleum Amasses Almost 300,000 Acres in Alberta Bakken (north central Montana)

Link here.

HOUSTON, June 13 – Primary Petroleum Corp., Calgary, has amassed 290,000 net acres under lease and option in Pondera and Teton counties, Mont.

The lease position is within the currently defined Southern Alberta basin Bakken fairway and begins at the southern border of the Blackfeet Indian Reservation.

More On Waterflooding in the Alberta Bakken -- Implications for the Williston Basin Bakken?

From New Technology Magazine.com, June 7, 2010:

"We're going to continue to push the technology here. We're continuing to move more towards cement liners versus the Packer's system. We're moving more towards development of the waterflood then (sic) just focusing on primary drilling," [Scott] Saxberg said, adding that initial results indicate that waterflood has the potential to increase recovery factors in the Bakken from about 10 percent to 30 percent.

Scott Saxberg is the president and CEO of Crescent Point Energy Corp.

I do not understand the difference between cement liners and the Packer's system (although I have an idea what the difference is, but not confident enough to post it yet), and will provide more on that later.

For more on the Alberta Basin Bakken, start here (from the Edmonton Journal, December 9, 2010) and then here, my own take on the Albert Basin Bakken.

Investors: Alberta Bakken

Opportunities in the Alberta Bakken.

The author had written on SandRidge earlier, and now writes on the following five companies:

• Primary Petroleum (PETEF.PK)
• Rosetta Resource (ROSE)
• Bowood Energy (ROAOF.PK)
• Connacher Oil and Gas (CLLZF.PK)
• Novus (NOVUF.PK)
• Second Wave (SCSZF.PK)

These could be very, very interesting for long-term investors who can "handle" volatility.

Primary Petroleum -- Montana State Land Auction -- Investors

Updates

February 29, 2012: Primary Petroleum sold 20,000 nets acres at $170/acre in the Williston Basin: specifically Daniels County, northeast of Elm Coulee and far west of where the action is in the Bakken/Williston Basin. I believe this is/was their entire Williston Basin/Bakken play. Primary Pete says they are focusing on their other Montana play (see below).  Discussion about the sale; and, the corporate website on the day of the announcement (I assume the latter link will be lost/changed over time).

Original Post

I don't have time to follow much of anything outside the North Dakota Bakken, but I know some readers are interested in investment possibilities and some have asked me or sent me information about Primary Petroleum.

Today it was announced that Primary Petroleum got the bulk of acres leased in the largest western Montana state land auction to date.

Primary Petroleum acquired 31,286 net acres (49 sections) out of the 45,000 net acres available for auction at the largest Western Montana State Land Sale Auction to date.

Ticker symbol for Primary Petroleum: PIE.V.

CALGARY, ALBERTA--(Marketwire - 03/03/11) - Primary Petroleum Corporation is pleased to announce that it was successful at the March 1st, 2011 Western Montana State Land Sale Auction where it acquired 31,286 net acres (49 sections) out of the 45,000 net acres available for auction at the largest Western Montana State Land Sale Auction to date. The acquired state leases along with Primary's ongoing Land Acquisition Strategy has enabled the Company to accumulate over 242,000 long term net acres (380 sections) in the Southern Alberta Basin Bakken Fairway of Western Montana.

Alberta Land Sales: Record and Price/Acre -- Not a Bakken Story

For those wanting to compare the value of mineral acres in the Bakken with those in Alberta, Oil and Gas Journal reports that Alberta land sales set a record in 2010, surpassing the previous record set in 2005. (All figures in Canadian dollars except for North Dakota figures.)

In 2010, Alberta's petroleum and natural gas land sales netted the province $2.38 billion, exceeding the previous sales record of $1.83 billion set in 2005. Land sales revenue was $732 million in 2009.

In addition, the July 7 sale netted an average price of $2,185/hectare, exceeding the previous high of $2,085/ha.

With a conversion factor of 2.47 acres/hectare, this works out to about $885/acre. Currently one US dollar = 0.9875 Canadian dollar, so for my purposes, parity.

My figures show North Dakota collected $230 million from land sales in 2010.

[I made a mistake when I posted this the first time regarding conversion of hectares to acres. Thank you to a reader for catching this for me.]

Alberta Bakken / Exshaw

The Alberta Bakken: A Potential New, Unconventional Tight Oil Resource Play, Recovery -- 2011 CSPG C SEG CWLS Convention, 2011

From SeekingAlpha.com, December 29, 2010

• Part One
• Part Two

The Alberta Bakken Play, BeatingTheIndex.com, February 7, 2011

Interest from Montana Bakken Spilling Into Alberta, Nickle's Daily Oil Bulletin, August 3, 2010 (it appears this link is broken; I will leave it up, "just in case").

 NEWS

May 12, 2016: Granite Oil and natural gas injection. Also here. 

August 25, 2015: early luster seems to have vanished. Regardless of current pricing challenges, it appears the geology is a hard nut to crack.

October 6, 2014: Super Nova announces new well in the Alberta Bakken.

March 18, 2013: Norstra enters the Alberta Bakken.  Their presentation is a bit misleading. The company talks about 200 rigs in the Williston Basin Bakken and then the slide of the huge projection increase in North Dakota, and then slides into the Alberta Bakken which has not yet been sorted out.


December 7, 2012: Eco-Trade acquires 5,800 acres in the Alberta Bakken.

November 18, 2012: if these numbers pan out, the Alberta Bakken will be much bigger than the Williston Basin Bakken: 

Alberta’s emerging shale and/or siltstone formations could ultimately yield 423.6 billion barrels of oil, 58.6 billion barrels of liquids and 3.3 trillion cubic feet of natural gas, says a long-awaited report by the Alberta Energy Resources Conservation Board and the Alberta Geological Survey.

September 29, 2012: I think the Alberta Bakken is also referred to as the Exshaw.

August 22, 2012: Dee Three update in the Alberta Bakken. 

December 12, 2011: Rosetta will allocate only 5% of CAPEX to southern Alberta Bakken; 95% will be allocated to the Eagle Ford.


November 22, 2011: Update regarding the Alberta Bakken from the October 5, 2011, edition of the Calgary Herald.  Data points

• 2.6 billion bbls recoverable oil (similar to Williston Basin Bakken); 7 - 10 percent recoverable OIP
• References Canada's biggest conventional play, the Pembina oilfield, 8 billion bbls; only one-fifth produced since the 1950s
• Typical well: 250 bbls/day; $4 million to drill; breaks even at $70 (US)
• Canada side: 31 producing of 47 drilled; Montana side: 8 producing wells of 23 completed
• References the Williston Basin Bakken: both deposited at same time, but geology different
• In Montana, the most active driller: Newfield; others: Primary Petroleum, Abraxas, and American Eagle

April 7, 2011: FX Energy, Salt Lake City, will be re-entering a well in Cut Bank oil field, to test the Bakken, Lodgepole, Nisku, and Duperow. Cut Bank oil field is located in the following Montana counties: Glacier, Toole, and Pondera. I assume this the "Albert Basin Bakken."

Original Post: The Alberta Bakken

For those who remember my first posting on the Alberta Bakken may remember what I said. I completely misunderstood the Alberta Bakken. I first heard of the "Montana" Bakken when reading about Rosetta Resources.

There is, in fact, an Alberta Bakken that is similar in age to the Williston Basin ("North Dakota") Bakken. It appears to have exploded onto the web scene in the latter half of 2010. Much less is known about the Alberta Bakken (compared to the North Dakota Bakken) but it might be every much as exciting.

According to the map provided by BeatingtheIndex.com, the Alberta Basin is much, much smaller than the North Dakota Bakken (with regard to the overlying surface). It is roughly oval in shape, straddling the Montana/Alberta border, equal halves in both jurisdictions. It appears to be just east of the Rockie Mountains (if so, I-15 runs right through it), extending south towards Great Falls, Montana, and north into Canada, particularly around Lethbridge, and a bit farther north (about same latitude as Calgary but slightly east).

The momentum behind the Alberta Bakken only shifted into high gear in September, when Crescent Point -- the biggest player in Saskatchewan's Bakken -- disclosed that it had assembled more than one million net acres of undeveloped land south of Lethbridge that it regards as prospective for light oil. -- The Edmonton Journal, December 9, 2010

Data Points on the Alberta Bakken

• The "Alberta Bakken" is of a similar age as the North Dakota Bakken (called the Saskatchewan Bakken in Canada)
• The Alberta Basin Bakken is much smaller in size (overlying surface area) than the Williston Basin Bakken. It is oval in shape, equal halves in Montana/Alberta, straddling the US/Canadian border north of Great Falls, Montana, and south of Lethbridge, Alberta.
• Crescent Point quietly amassed one million mineral acres in the Alberta Basin, announcing their holdings in late 2010
• There is significantly much less known about the Alberta Bakken compared to the Alberta Bakken and it will take longer to explore and develop
• Producers often mentioned in connection with the Alberta Bakken: Rosetta, Newfield, Crescent Point, and Murphy Oil
• There is another "Montana Bakken" in central Montana but this is targeting a different formation. Rosetta Resources has a major role there

Additional Links

Investment site, Alberta Bakken 1
Investment site, Alberta Bakken 2 
Investment opportunities in the Alberta Bakken, December, 2010

Background Regarding This Posting

The Alberta Bakken is garnering increasing interest and I am being sent comments regarding this, "the next big thing."

I have enough trouble keeping up with the North Dakota Bakken so am conflicted how to handle posting information on the Alberta Bakken. This site is focused on the North Dakota Bakken and I don't want to muddy the waters by adding another oil play.

So, that's how I will handle it: I will occasionally post notes about the Alberta Bakken and link it on the sidebar at the right.