This is pretty cool. Direct from the blog on several levels.
Some months ago, while tracking older Bakken wells, I started using the phrase, "steady Eddy." At the time I had never seen that phrase in all the articles -- and there must be a million articles by now -- I've read regarding the Bakken or the oil and natural gas sector. Here's a screen shot of my "16xxx" post:
I've also talked many times in the past year that it's my contention that short term, the Bakken is "a better bet" than the Permian. I've also singled out Oasis, "what don't you want?"
The romance with the Permian
might not be over just yet, but many analysts are trying to show
smitten investors that there's a steady Eddy they should perhaps pay
more attention to.
That steady Eddy would be none other than the Bakken.
Among
these is Pablo Prudencio, an upstream analyst for Woods MacKenzie in
their Houston office. It is his job to help investors weigh the pros and
cons of each play, and help them determine which play is the best bang
for their buck. He spoke at the recent Bakken Conference and Expo on the
topic.
Permania, he said, has been a
very popular term to explain what’s been going on with the shale play,
with its sky’s the limit entry prices.
“A
lot of companies have paid a lot of money to get into the Permian,” he
said. “The average Permian deal was $25,000 for every net acre.”
By contrast, the average in the Bakken is more like $2,500 per net acre.
There
were even deals that were far more than $25,000 per acre, such as Oasis
Petroleum’s purchase of acreage it described as “core of the core” in
the Delaware portion of the Permian. That $946 million purchase averaged
$46,600 per net acre.
Investors
have paid these kinds of premiums for Permian positions because it
offers 2,500 feet of stacked play. That’s like having several
“Bakken-style” layers on top of each other, Prudencio explained. And
because Permian wells so far seem to have break-evens that are less than
the Bakken.
However, a
deeper dive into the numbers shows a somewhat different picture, and
“Permania” is subsiding as these issues become more clear.
It was in the fall of 1989, I suppose, our last year in England, when I started reading out Twin Peaks in Newsweek magazine. I was not a bit disappointed when I saw the show. We were back in Germany when the Twin Peaks premiered, so I have no idea when I first saw the series. But I loved it then, and I still love it.
As I watched the video above, the first series I thought of, Netflix's House of Cards and Hitchcock, in general.
Meanwhile, a google search of "oil blogs" results in 48,600,000 hits and the MDW blog is on the middle of page 5. Many of the "hits" that rank higher are not even current any more including the much ballyhooed "oildrum" blog, a peak oil theory blog.
Top 60 oil blogs here. Scrolling through quickly I did not see any "Bakken-specific" blogs. What a shame.
