ND State Mineral Lease Sales -- February, 2021

Link to auction site here.

February, 2021, online auction results.

Burke County:

• three parcels
• each parcel 80 acres
• bonus:
• low: $103/acre
• high: $130/acre

McKenzie County:

• three parcels
• each parcel 160 acres
• bonus:
• low $19/acre
• high: $7/acre

Two Wells Coming Off Confidential List -- No Production Data -- February 17, 2021

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here. 

Fast and furious:

• Covid-19: South Africa rolls out J&J vaccine to healthcare workers; the vaccine has not yet been approved anywhere; link here.
• Buffett: back to oil; bets billion on Chevron. Link here.
• Buffett: buys into E. W. Scripps; trims Apple holdings. Story easily found.
• Buffett: maintains 36.1 million shares DaVita, a 31.7% stake; BRK remains Da Vita's largest shareholder; link here. Boosts stake in Da Vita to 33%; link here.
• Apple: extends lead over Samsung with semiconductor purchases. Link here. 

Apple: from the link above --

Apple was easily the largest buyer of semiconductor chips in 2020. Apple spent $53.6 billion and took 11.9% of the global market share, representing 24% growth year-on-year, while Samsung was the second biggest buyer, spending $36.4 billion and taking 8.1% of the market, representing 20.4% growth year-on-year.

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Back to the Bakken

Active rigs:

$60.35	2/17/2021	02/17/2020	02/17/2019	02/17/2018	02/17/2017
Active Rigs	15	56	64	56	40

Wednesday, February 17, 2021: 13 for the month, 46 for the quarter, 46 for the year.

• 37557, loc/NC, CLR, Norway 13-5H, Fancy Buttes, first production, --; t--; cum --;
  
• 36242, loc/NC, BR, Maverick 1E MBH, Dimmick Lake, first production, --; t--; cum --;
  

RBN Energy: Extreme cold wreaks havoc with natural gas producers, power generators, and everybody in between. 

f you’re reading this, it means you’ve got access to power and internet. Count yourself among the fortunate today. Rolling blackouts and brownouts across the middle of the country and in Texas, have disrupted businesses and lives. It’s been particularly brutal in the Lone Star State. Electricity and natural gas are commodities that are so basic to our way of living that it’s easy to take for granted the efforts designed to make them reliable, available, and affordable. But, boy, does it make things difficult when they don’t show up as anticipated. In today’s blog, we discuss the factors behind the supply disruptions that are wreaking havoc in these commodity markets.

CLR, February, 2021, Corporate Presentation

CLR February, 2021, presentation, link here.

2021 guidance.

• CAPEX: $1.4 billion non-acquisition CAPEX budget
• back of the envelope:
• $1.4 billion / $8 million = 175 new wells
• total production growth y/y: 3 - 4%
• production expense per boe: $3.50
• cash G&A  per boe: $1.30

Peer groups

• XEC
• PXD
• FANG
• EOG
• MRO
• DVN
• OVV

2020 Results:

• $275 million in free cash flow
• $1.16 billion CAPEX (compare with $1.4 billion for CY2021
• production:
• 160,500 bopd
• 838 million cfpd
• production expense per boe: $3.27
• cash G&A per boe: $1.20
• gas capture: 98.3%
• debt: $1.5 billion of near-term maturities extended to 2031 with new bond offering

Completed well costs (North Dakota)

• Bakken:
• $690 all-in cost per lateral foot per well in 2002
• 10,000' average lateral length
• $4.9 million D&C per well;
• Southern:
• $1,070 all-in cost per lateral foot per well in 2002
• 8,200' average lateral length
• $7.6 million D&C per well;

Southern step-out unit:

• northwest corner of Stark County; southeast corner of Billings County
• five unit wells outperforming legacy well
• economics exceeding 30% ROR at $50 WTI
• $6.4 million average CWC per well
• Whiting's southern play
• area "owned" by Whiting
• CLR has acres are in this area

CLR Acquisition In The Power River Basin, Wyoming -- February 17, 2021

CLR February, 2021, presentation, link here.

CLR may refer to this as the "Samson deal," or the "Samson acquisition" or the "Samson leasehold."

History of Samson Resources, from the blog's "operators page":

• 2017, January: transfers 130 wells to Resource Energy CAN-AM, LLC 
• 2016, August: files new Chapter 11 exit plan; 
• 2015: files for bankruptcy; that plan ultimately failed as oil prices continued to plummet
• November, 2014: Samson Resources Bakken assets up for sale? Samson Resources Bakken assets said to be worth less than $500 million
• sells 20,000 acres for $30 million to Magnum Hunter; Divide County, along Canadian border
• sells 120,000 acres in Divide County and northern Williams County to CLR
  
• previously private, bought by a consortium led by KKR in 2011 (?) for $7.2 billion; Bakken assets worth $650 million (?)

Note the "relationship" of Samson Resources with CLR. 

For background by the company go to this site first: undated, but it appears to have been posted late 2019, or early 2020, with strategic overview/plans for calendar year 2020:

• headquartered in Tulsa, OK
• March 1, 2017: Samson Resources emerged from bankruptcy as Samson Resources II, LLC
• 85 new equity investors
• assets in
• East Texas / North Louisiana
• Wyoming: Greater Green River and Powder River basins
• September, 2017:
• the company sold its assets in East Texas/North Louisiana for $525 million
• company paid off existing debt and make a large cash distribution to its sharebholders
• In September, 2019:
• the company sold its assets in the Greater Green River Basin
• declared another special distribution to its sharesholders
• 2020: pure play Powder River Basisn
• 132,000 net acres
• 2,400 state permits
• 10,000 bopd (73% liquid)

Then this site, January 4, 2021:

• to sell all of its Powder River Basin to an undisclosed buyer for $215 million in an all-cash transaction;
• the company exited 2020 producing 8,500 boepd (75% oil) from the Powder River Basin
• the sale is expected to close on/about March 4, 2021
• effective date: January 1, 2021
• following the closing, the company will have divested substantially all of its upstream assets
• the company's only remaining upstream oil and gas assets will consist of approx 24,000 net leasehold acres, 23,000 net mineral acres and 40 non-operated wells, all located in East Texas, Oklahoma and Louisiana which the company anticipates divesting in early 2021
• using proceeds fro that sale, the company will pay off approx $13 million in debt and make a cash distribution to its unitholders
• CEO: Joseph A. Mills
• founded in 1971 by Charles Schusterman
• following the closing of the Powder River Basin sale, the company will begin the process of winding down its affairs and moving toward final dissolution

Now, the February, 2021, CLR corporate presentation, linked above, slide #11:

• straddles Campbell and Converse counties in Wyoming
• net resource potential:
• 400 million boe
• 75% oil
• net acres: 130,000 (80% held-by-production)
• current net production: 9,000 boepd, 80% oil
• federal permits: 96 in-hand (6 rig years)
• purchase price: $215 million
• close: March 4, 2021
• three of the top five wells in the Powder River Basin in the leasehold position
• average IP30: 2,670 boepd (88% oil); 2,670 x 30 days = 80,000 boe per 30-day month
• CLR 2-rig program starting in 2Q21
• initial targets: Shannon, Frontier, and Niobrara
• future targets: Sussex; Mowry, Muddy
• the six formations: 4,800' stacked play

Back-of-the-envelope:

• $215 million / 130,000 net acres = $1600/acre
• one primary target
• two secondary targets
• three future targets, in a stacked play

CLR is tracked here.

• last time I checked, May, 2018, 796,000 net acres in the Bakken
• 130,000 / 796,000 = 16%

Monthly Drilled, Completed Wells And DUCs In The Bakken And Permian -- Most Recent Data, January, 2021

A reader provides me the number of wells drilled, completed, and drilled/not completed (DUCs) each month. I've abbreviated the chart. I've only provided the data from the Bakken and the Permian, and I've only included certain months going back to January, 2014.

I've always been impressed with how little the number of t6DUCs really changes over time in the Bakken, running between 700 and 850. Back in December, 2014, there were 732 DUCs in the Bakken. Fast forward to January, 2021, and there were 745 DUCs in the Bakken.

During that same period, from December, 2014, to January, 2021, the number of DUCs in the Permian increased from 1,036 to 3,468.

In the Bakken the number of drilled wells (around 20) and the number of completed wells (around 40) have remained fairly steady. 

In the Permian, the number of drilled wells dropped from over 600 in December, 2014, to 187 in January, 2021. Likewise, the number of completed wells in the Permian dropped from 577 in December, 2014, to 225 in January, 2021.

The "187" drilled wells in January, 2021 in the Permian is the most since April, 2020. Likewise, the "225" completed wells in January, 2021, is the most completed since April, 2020.

No conclusions drawn, simply presenting the data.