Well, this is sort of interesting in light of all the discussion regarding the Tyler formation. It's probably nothing, but then again, who knows?
In southwest North Dakota, in Bowman County, and in Slope County, there are two active rigs according to NDIC GIS map server. They are both CLR's.
One is particularly interesting, the one in Slope County, just across the county line from Bowman County.
The rig sits on a well that is currently shown as active and producing, with a status date of October 4, 1997 (thirteen years ago, or so), file number 14154, 19-133-106, Flor 24-19RH. A work-over rig? I don't know enough about the industry to know whether the GIS map server includes work-over rigs.
Notice the interesting designation for this well: "RH." The "H" designates "horizontal, but I don't know what the "R" designates. There are also several wells in this field that have an "F" designation (no "H" at all); I also have no idea what the "F" stands for.
It will be interesting to see what CLR is up to. Interesting enough I may have to subscribe to NDIC's "Basic Subscription," $50/year. We'll see.
By the way, CLR has another confidential file just 750 feet northwest of Flor 24-19RH: Flor 24-19NH, file number 19862.
UPDATE: see comment below that explains much of this. Neither the Bakken nor the Three Forks formations are in play here. These are Red River wells. According to first comment below, the well in question is an injection well. I would assume the "R" designation means Red River. I still don't know what the "F" designation means.
Sunday, January 2, 2011
Wow, wow, wow -- this was 2nd top story at Yahoo!Finance moments ago -- APNewsBreak -- 168 Rigs -- New Record
News/Updates
Anchorage newspaper also carries story!
PennEnergy.com reports a similar story on January 14, 2011:
According to separate reports from both the North Dakota Pipeline Authority and the US Department of Energy, if the current trends in production continue, North Dakota may overtake Alaska as the No. 1 producer in the US by 2017.
Should the increase in drilling and production in North Dakota continue, the output in North Dakota may rise to between 450,000 and 700,000 barrels of oil a day within the next five to seven years, reported the North Dakota Pipeline Authority.
On the other hand, the production coming out of Alaska is slated to drop to 450,000 barrels a day by 2017, the DOE reported.
Original Posting
Headline, 3:30 p.m., January 2, 2011: APNewsBreak: ND Oil Patch May Double Production
(Of course, in an hour from now, this story will no longer be at the top of the page, but for a few minutes, North Dakota beat out every other financial story -- except the iPhone.)
First two paragraphs (this is truly incredible):
Government and industry officials believe North Dakota's oil patch contains more than twice the amount of oil previously estimated and that the state's already record crude production will double within the decade.
If the forecast is correct, North Dakota could leapfrog in a few years from the fourth-biggest oil producing state to No. 2, trailing only Texas.Remember: this was not a blurb in the Bismarck Tribune or the Williston Herald. When this story first appeared, it was the second story on Yahoo!Financial. The first story had to do with an iPhone glitch regarding the iPhone's alarm feature.
Also, note that the spokesperson said a record 168 rigs were drilling in the state (my database showed 166 as the record). Of course, the number of "potentially" active rigs is generally five to ten higher than the actual number active rigs due to fact that at any given moment, some rigs in North Dakota are being transported to another site or are under repair or routine maintenance.
Note: someone commented below that it was unlikely that North Dakota would pass Alaska in oil production. I countered. Following that exchange, this article appeared: environmentalists have stymied Shell Oil in Alaska once again. January 6, 2011. Yes, it is very possible that North Dakota will surpass Alaska in oil production.
Double Counting Net Acreage
I try to keep the posting on the net acreage that various companies have in the Bakken current, but of course it is impossible, but for newbies, it provides a snapshot of the acreage controlled by some of the bigger players in the Bakken.
Several Bakken players, such as BEXP, Whiting and Continental Resources) provide very informative corporate presentations. This is a link to BEXP's current presentation (January, 2011).
It is interesting to note that BEXP breaks out their net acreage by formation: Bakken and Three Forks, but they do not "double count." That's very impressive. For example, in their Parshall/Ross prospect, BEXP reports they control 35,900 net acres targeting the Bakken and 35,900 net acres targeting the Three Forks formation. One would assume that these underlie the same "surface acres." To their credit, when totaling up their net Williston Basin net acreage, BEXP only counts the "35,000 net acres" once.
[The astute investor trying to put a value on a Bakken play might want to consider what is actually meant by "net acres" when valuing a company in the Bakken.]
I don't know how long BEXP has been differentiating the acres they control by formation, but it is interesting to note (for investors) that BEXP is not yet including the other formations that already are known to produce oil in these areas, and potential additional formations, such as the Red River, the Lodgepole, the Tyler, and maybe even the Birdbear and the Spearfish. A lot of it depends on price of oil going forward. One can be pretty well assured that if the price of oil gets high enough, folks will be going back in to target these other formations.
Several Bakken players, such as BEXP, Whiting and Continental Resources) provide very informative corporate presentations. This is a link to BEXP's current presentation (January, 2011).
It is interesting to note that BEXP breaks out their net acreage by formation: Bakken and Three Forks, but they do not "double count." That's very impressive. For example, in their Parshall/Ross prospect, BEXP reports they control 35,900 net acres targeting the Bakken and 35,900 net acres targeting the Three Forks formation. One would assume that these underlie the same "surface acres." To their credit, when totaling up their net Williston Basin net acreage, BEXP only counts the "35,000 net acres" once.
[The astute investor trying to put a value on a Bakken play might want to consider what is actually meant by "net acres" when valuing a company in the Bakken.]
I don't know how long BEXP has been differentiating the acres they control by formation, but it is interesting to note (for investors) that BEXP is not yet including the other formations that already are known to produce oil in these areas, and potential additional formations, such as the Red River, the Lodgepole, the Tyler, and maybe even the Birdbear and the Spearfish. A lot of it depends on price of oil going forward. One can be pretty well assured that if the price of oil gets high enough, folks will be going back in to target these other formations.
North Dakota Geological Survey Newsletter
This is just a reminder that the North Dakota Geological Survey publishes a newsletter twice a year. The most recent edition has just been published.
For Investors Only: Investopedia on the "Face of the Bakken"
Another nice Investopedia article featuring Continental Resources.
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