Bakken Shale News

Continental Resources Appoints New President

Stock Drops Slightly Following Announcement of High Bakken Well Costs
Continental President & COO Jack Stark

Continental President & COO Jack Stark

Continental Resources appointed a new president and COO this week, following the reportedly unexpected resignation of Rick Bott last week.

Read more: Major Bakken Producer’s President Quits – Continental Resources 

The company provided few details when Bott left his position, other than he was leaving “to pursue other opportunities.” Bott’s replacement is Jack Stark, 59. Stark has been with Continental since 1992, and was formerly the company’s Senior VP of Exploration.

Continental Stock Dips Slightly

In the midst of its leadership change, Continental also announced that it plans to increase its’ portfolio-wide capital expenditures budget for 2014 to $4.55-billion ($2.85-billion in the Bakken). The reason for the increase has to do with Bakken well costs, which the company revealed this week are $10-million per well. That’s more than $2-million per well, compared to the same time last year. This comes at at time when most operators in the area are reducing the well costs. According to Forbes, as a result of the higher than expected well costs, the company’s stock dropped ~8% (about $5 per share) on Sept. 18th.

Continental is the largest oil producer in the Rockies,  Bakken Shale play and the SCOOP play combined. It is the second largest producer in the Bakken, behind Whiting Petroleum, which just recently acquired Kodiak Oil & Gas.

Read more at contres.com

Bakken Natural Gas – Too Much of a Good Thing?

BP: U.S. is Top Natural Gas Producing Country in the World
Bakken Oil Well

Bakken Oil Well | Click to Enlarge

The oil & gas renaissance in the U.S. has nearly catapulted the country to the top spot for oil production in the world, and most experts believe the U.S. will hit this target by next year. But is it possible that the country and the Bakken has too much of a good thing? When it comes to natural gas that may be the case.

According to the BP 2014 statistical world energy review, the U.S. is currently the top natural gas producing country in the world at 328 Bcf/d. Over the past five years, natural gas production has grown over 20% in the U.S., thanks in large part to the shale revolution. But the price of natural gas has struggled to break $4/mmbtu, and oil companies in North Dakota’s and Montana’s Bakken Shale and the Eagle Ford Shale in South Texas have flared much of their produced natural gas in favor of capturing oil, which is a much higher valued commodity. Currently, the WTI price of crude oil is hovering around $95/bbl.

In North Dakota, where production from the Bakken Shale is highest, the state flares just under 30% of its produced natural gas. Recently, the first of several new rules has been enacted in the state to combat flaring. The North Dakota Industrial Commission (NDIC), the state’s regulatory body for the oil and gas industry, hopes to capture 90% of Bakken natural gas by 2020; however, serious infrastructure improvements, including gas gathering systems and natural gas pipelines will need to be implemented in the Williston Basin for this goal to be achieved. The alternative could mean operators will need to shut-in wells to meet flaring guidelines – that’s bad news for them, the state and mineral owners.

Read more: NDIC Implements New Bakken Flaring Rule – June 1, 2014

What this boils down to is the U.S. has an abundance of natural gas, which is a good thing. The bad thing is the country lacks the infrastructure to capture all of it.

With world usage of natural gas accounting for 24% of all primary energy consumed, there is decidedly a market for natural gas. But the only effective way to transport natural gas to foreign markets is to liquify it, which is costly. Ultimately, natural gas production is subject to the free market. As long as the price stays low, there’s less economic benefit for operators to produce it, and companies to transport it and market it.

Click Here to read the full BP report

Bakken Shale Rig Count Increases by Two to 193

Continental Resources' President and COO Rick Bott Quits
Continental Resources Bakken Three Forks Map

Continental Resources Bakken-Three Forks Map | Click to Enlarge

The Bakken-Three Forks rig count increased by two to 193 rigs running across our coverage area by the end of last week. The NDIC notes 199 rigs are active in North Dakota, but around 14 of those are in the process of moving in and rigging up.

In recent Bakken news, the Bakken’s second largest producer, Continental Resources, Inc., announced last week that President and COO W.F. “Rick” Bott, 54, has resigned to “pursue other opportunities.”

According to company officials, his duties will be absorbed by senior management. Bott joined Continental in 2012, and worked previously at Cairn India Ltd and in Devon Energy Corp’s international division.

Read more: Major Bakken Producer – Continental Resources – President Quits

The U.S. rig count increased by six to 1,931 rigs running by the end of last week. A total of 338 rigs were targeting natural gas (two more than the previous week) and 1,592 were targeting oil in the U.S. (8 more than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.)194 rigs are running in the Williston Basin across MT, ND, and SD. 185 are in ND alone.

Not all rigs counted in our census are drilling for the Bakken, but it’s close. The NDIC estimates 95% or more of activity in this region targets the Bakken and Three Forks formations.

Note: The NDIC reports 199 rigs are active in North Dakota. That is five more than Baker Hughes reports in the Bakken area, and 14 more than the company reports in North Dakota. On any given week, a certain number of rigs are in route to the next well location or idle waiting to drill the next well. The NDIC notes that around 14 rigs are in the process of moving in and rigging up.

Bakken Oil & Gas Rigs

The number of oil rigs increased by two to 193 rigs running by the end of the week . WTI oil prices decreased slightly from the previous week, trading at $92.34/bbl on Friday afternoon. Williston Basin Sweet crude traded at $73.94/bbl on Aug. 29th. The WTI-Brent opened up a bit, settling at just under $7 by the end of last week.

The natural gas rig count in the region held flat at zero. Natural gas futures (Henry Hub) were trading at $3.94/mmbtu by the end of last week. A little more than 10% of the production stream from the Bakken and Three Forks is attributable to natural gas and roughly half of that is NGLs.

McKenzie County continues to lead development with 66 rigs running. Mountrail, and Williams counties are the only other counties with more than 30 rigs running each. View the full list below under the Bakken Drilling by County section.

Activity is dominated by horizontal drilling:

  • 177 rigs are drilling horizontal wells
  • 16 rigs are drilling directional wells
  • 0 rigs are drilling vertical wells

Bakken Oil & Gas News

Be sure to visit our Bakken Job Listings to search openings and come back weekly for updates or sign up for alerts – Daily or Weekly Email Alerts

Bakken Drilling by County


County State Previous Week Current Week County State Previous Week Current Week
MCKENZIE ND 66 66 DANIELS MT 0 0
WILLIAMS ND 32 32 DAWSON MT 0 0
MOUNTRAIL ND 30 30 FALLON MT 0 0
DUNN ND 23 23 SHERIDAN MT 0 0
DIVIDE ND 9 9 VALLEY MT 0 0
BURKE ND 7 7 WIBAUX MT 0 0
RICHLAND MT 4 4 GOLDEN VALLEY ND 0 0
BOTTINEAU ND 3 3 MCLEAN ND 0 0
ROOSEVELT MT 2 2 MERCER ND 0 0
BILLINGS ND 2 2 WARD ND 0 0
RENVILLE ND 2 2 MCHENRY ND 0 0
STARK ND 2 2

What is the Rig Count?

The Bakken Shale Rig Count is an index of the total number of oil & gas drilling rigs running across Montana and North Dakota. The rigs referred to in this article are for ALL drilling reported by Baker Hughes and not solely wells targeting the Bakken formation. All land rigs and onshore rig data shown here are based upon industry estimates provided by the Baker Hughes Rig Count.

Major Bakken Producer’s President Quits – Continental Resources

Botts Departure Leaves Leadership Gap

The Bakken’s second largest producer, Continental Resources, Inc., announced this week that President and COO W.F. “Rick” Bott, 54, has resigned to “pursue other opportunities.”

According to company officials, his duties will be absorbed by senior management. Bott joined Continental in 2012, and worked previously at Cairn India Ltd and in Devon Energy Corp’s international division.

Continental CEO Harold G. Hamm said, “we are grateful for his professional contributions and wish Rick the very best.”

During the second quarter of 2014, Continental Resources completed 224 gross (93 net) wells in the Bakken, and finished the reporting period with an inventory of approximately 84 gross operated (66 net) Bakken wells drilled, but not completed. Continental’s Bakken production totaled 108,573 boe/d (North Dakota: 94,702 boe/d, Montana: 13,871 boe/d) for the second quarter, which was an increase of 11% quarter-on-quarter and 23% year-over-year.

Read more: Continental Resources Bakken Production Up 

Continental says it is ahead of its five year plan to triple production and proved reserves from 2012 to 2017 and maintains its leadership position as the largest oil producer in the Rockies,  Bakken Shale play and the SCOOP play combined.

Continental currently holds ~1.14-million net acres in the Bakken.

Read more at contres.com

Bakken Shale Rig Count Stays Flat at 191

Pembina Pipeline Corp. Acquires Bakken Assets - $650-Million
Saskatchewan Ethane Processing Plant

Saskatchewan Ethane Processing Plant|Click to Enlarge

The Bakken-Three Forks rig count stayed flat at 191 rigs running across our coverage area by the end of last week. The NDIC notes 198 rigs are active in North Dakota, but around 15 of those are in the process of moving in and rigging up.

In recent Bakken news, Pembina Pipeline Corp. announced in early Sept. 2014 it will acquire Bakken midstream assets for $650-million from entities affiliated with Riverstone Holdings, LLC.

Read more: Pembina Acquires Bakken Assets – $650 Million

The U.S. rig count increased by 11 to 1,925 rigs running by the end of last week. A total of 340 rigs were targeting natural gas (two more than the previous week) and 1,584 were targeting oil in the U.S. (nine more than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.). 192 rigs are running in the Williston Basin across MT, ND, and SD. 183 are in ND alone.

Not all rigs counted in our census are drilling for the Bakken, but it’s close. The NDIC estimates 95% or more of activity in this region targets the Bakken and Three Forks formations.

Note: The NDIC reports 198 rigs are active in North Dakota. That is six more than Baker Hughes reports in the Bakken area, and 15 more than the company reports in North Dakota. On any given week, a certain number of rigs are in route to the next well location or idle waiting to drill the next well. The NDIC notes that around 15 rigs are in the process of moving in and rigging up.

Bakken Oil & Gas Rigs

The number of oil rigs stayed flat at 191 rigs running by the end of the week . WTI oil prices stayed relatively flat from the previous week, trading at $93.25/bbl on Friday afternoon. Williston Basin Sweet crude traded at $79.94/bbl on Aug. 29th. The WTI-Brent opened up a bit, settling at just under $7 by the end of last week.

The natural gas rig count in the region held flat at zero. Natural gas futures (Henry Hub) were trading at $3.98/mmbtu by the end of last week. A little more than 10% of the production stream from the Bakken and Three Forks is attributable to natural gas and roughly half of that is NGLs.

McKenzie County continues to lead development with 66 rigs running. Dunn, Mountrail, and Williams counties are the only other counties with more than 25 rigs running each. View the full list below under the Bakken Drilling by County section.

Activity is dominated by horizontal drilling:

  • 175 rigs are drilling horizontal wells
  • 16 rigs are drilling directional wells
  • 0 rigs are drilling vertical wells

Bakken Oil & Gas News

Be sure to visit our Bakken Job Listings to search openings and come back weekly for updates or sign up for alerts – Daily or Weekly Email Alerts

Bakken Drilling by County


County State Previous Week Current Week County State Previous Week Current Week
MCKENZIE ND 67 66 FALLON MT 1 1
WILLIAMS ND 35 35 DANIELS MT 0 0
MOUNTRAIL ND 33 33 DAWSON MT 0 0
DUNN ND 26 26 SHERIDAN MT 0 0
DIVIDE ND 10 10 VALLEY MT 0 0
RICHLAND MT 4 4 WIBAUX MT 0 0
ROOSEVELT MT 3 3 GOLDEN VALLEY ND 0 0
BURKE ND 3 3 MCLEAN ND 0 0
RENVILLE ND 3 3 MERCER ND 0 0
STARK ND 3 3 WARD ND 0 0
BILLINGS ND 1 2 MCHENRY ND 0 0
BOTTINEAU ND 2 2

What is the Rig Count?

The Bakken Shale Rig Count is an index of the total number of oil & gas drilling rigs running across Montana and North Dakota. The rigs referred to in this article are for ALL drilling reported by Baker Hughes and not solely wells targeting the Bakken formation. All land rigs and onshore rig data shown here are based upon industry estimates provided by the Baker Hughes Rig Count.

Rail Lines Face Bottlenecks in Bakken

September 2014 Hearing Urges Regulators to Put Pressure on Railroads to Fix Issues Blocking Grain Shipments
Oil Rail Car Image

Crude Oil Rail Car | Click to Enlarge

At the Surface Transportation Board (STB) hearing this week in Fargo, ND, officials from the state and other upper Midwestern states urged U.S. regulators to put pressure on railroads to fix issues that are blocking grain shipments. The culprit some believe is the oil & gas industry – in August, approximately 60% of oil produced in North Dakota was transported out of the state by rail, and some argue the railroads are favoring oil companies over agriculture.

Bloomberg reported, as grain produced last year sits in storage, waiting for trains to carry it to market, the bottlenecks may get worse as an anticipated record grain harvest begins, officials warned.

John Hoeven, the Republican Senator from North Dakota, said at the hearing, “the bottom line is that we need greater rail capacity to meet the growing needs of North Dakota’s expanding economy and dynamic businesses and farms. To make that happen, railroads must commit to investing in more rail infrastructure, including more locomotives, more railcars and more crews.”

In June, the board ordered the railroads to provide weekly updates on bottlenecks. Regulators can order railroads to prioritize certain shipments over others, although that power is rarely used, the Bloomberg article noted.

BNSF Railway, along with Canadian Pacific Railway Ltd., was directed by the STB to appear. Earlier in 2014, BNSF said it would hire 5,000 workers and add 500 locomotives to expand its network. The company said it’s spending $390-million on expansion and maintenance projects in North Dakota in 2014. Since 2009, traffic in and out of North Dakota has increased by 144% on BNSF.

Read more at star-telegram.com

Pembina Acquires Bakken Midstream Assets – $650 Million

Deal Expected to Close in the Fourth Quarter of 2014
Saskatchewan Ethane Processing Plant

Saskatchewan Ethane Processing Plant|Click to Enlarge

Pembina Pipeline Corp. announced in early Sept. 2014 it will acquire Bakken midstream assets for $650-million from entities affiliated with Riverstone Holdings, LLC.

The deal includes the Vantage pipeline system, which carries up to 40,000 b/d of natural gas liquids from the North Dakota Bakken to Alberta, where it is connected to the Alberta Ethane Gathering System pipeline. Also included the deal are Mistral Midstream Inc’s interest in a Saskatchewan ethane processing plant. The plant is expected to produce 4,500 b/d of ethane, and it will connect into Vantage system through a pipeline lateral that is also currently under construction. The deal is expected to close in the fourth quarter of 2014.

Pembina anticipates additional capital expenditures of approximately $91.5-million (net to Pembina) prior to the end of 2015 in connection with the Transaction in order to complete the construction of the ethane processing plant and the associated gathering and delivery system.

 

In addition to the Bakken acquisition, the company also announced plans to build a 37,500 b/d propane export terminal in Portland, Oregon, for $500-million. The facility is expected to be in service by 2018.

Read more at pembina.com

 

 

Bakken Shale Rig Count Stays Flat at 191

Conoco Q2 Bakken Production Increases 19% Quarter on Quarter
Conoco Phillips Bakken Acreage Map

Conoco Phillips Bakken Acreage Map | Click to Enlarge

The Bakken-Three Forks rig count stayed flat at 191 rigs running across our coverage area by the end of last week. The NDIC notes 194 rigs are active in North Dakota, but around 19 of those are in the process of moving in and rigging up.

In recent Bakken news, Conoco Phillips, a major Bakken operator, grew its production by 38% year-over-year to 208,000 boe/d in the Eagle Ford Shale and Bakken Shale plays combined. That’s ~39% of the company’s total production for its Lower 48 asset portfolio. In the Bakken, production grew 19% quarter-on-quarter from 43,000 boe/d to 51,000 boe/d. However, company officials expect for the rate of growth to slow in both plays in the second half of the year due to multi-pad drilling effects and weather-related issues in the fourth quarter.

Read more: Conoco’s Bakken Production Up 19% – Q2 2014

The U.S. rig count increased by 18 to 1,914 rigs running by the end of last week. A total of 338 rigs were targeting natural gas (eight more than the previous week) and 1,575 were targeting oil in the U.S. (11 more than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.). 192 rigs are running in the Williston Basin across MT, ND, and SD. 183 are in ND alone.

Not all rigs counted in our census are drilling for the Bakken, but it’s close. The NDIC estimates 95% or more of activity in this region targets the Bakken and Three Forks formations.

Note: The NDIC reports 194 rigs are active in North Dakota. That is two more than Baker Hughes reports in the Bakken area, and eleven more than the company reports in North Dakota. On any given week, a certain number of rigs are in route to the next well location or idle waiting to drill the next well. The NDIC notes that around 19 rigs are in the process of moving in and rigging up.

Bakken Oil & Gas Rigs

The number of oil rigs stayed flat at 191 rigs running by the end of the week . WTI oil prices stayed relatively flat from the previous week, trading at $95.85/bbl on Friday afternoon. Williston Basin Sweet crude traded at $82.69/bbl on Aug. 29th. The WTI-Brent closed up a bit, settling at ~$6 by the end of last week.

The natural gas rig count in the region held flat at zero. Natural gas futures (Henry Hub) were trading at $4.08/mmbtu by the end of last week. A little more than 10% of the production stream from the Bakken and Three Forks is attributable to natural gas and roughly half of that is NGLs.

McKenzie County continues to lead development with 67 rigs running. Dunn, Mountrail, and Williams counties are the only other counties with more than 25 rigs running each. View the full list below under the Bakken Drilling by County section.

Activity is dominated by horizontal drilling:

  • 175 rigs are drilling horizontal wells
  • 16 rigs are drilling directional wells
  • 0 rigs are drilling vertical wells

Bakken Oil & Gas News

Be sure to visit our Bakken Job Listings to search openings and come back weekly for updates or sign up for alerts – Daily or Weekly Email Alerts

Bakken Drilling by County


County State Previous Week Current Week County State Previous Week Current Week
MCKENZIE MT 67 67 BILLINGS MT 2 1
WILLIAMS ND 35 35 DANIELS ND 0 0
MOUNTRAIL MT 33 33 DAWSON ND 0 0
DUNN MT 26 26 SHERIDAN ND 0 0
DIVIDE ND 10 10 VALLEY MT 0 0
RICHLAND ND 4 4 WIBAUX ND 0 0
ROOSEVELT ND 3 3 GOLDEN VALLEY MT 0 0
BURKE ND 3 3 MCLEAN MT 0 0
RENVILLE ND 3 3 MERCER MT 0 0
STARK ND 2 3 WARD ND 0 0
BOTTINEAU ND 2 2 MCHENRY ND 0 0
FALLON ND 1 1

What is the Rig Count?

The Bakken Shale Rig Count is an index of the total number of oil & gas drilling rigs running across Montana and North Dakota. The rigs referred to in this article are for ALL drilling reported by Baker Hughes and not solely wells targeting the Bakken formation. All land rigs and onshore rig data shown here are based upon industry estimates provided by the Baker Hughes Rig Count.

Quantum Energy, Inc. Secures Two Bakken Refinery Sites

Expected Production of 7,000 b/d Diesel Fuel from Each Facility

At the end of August, 2014, Tempe, AZ-based Quantum Energy, Inc. secured two refinery sites to serve the Bakken. The refineries are part of a proposed five refinery plan the company has for the area.

One of the refineries will be located in Richland County, MT, near Fairview and is accessible to the Northstar Transload currently under construction in North Dakota. The other refinery will be located in Baker, MT.

Quantum President Stan Wilson, said, “each of our proposed Energy Centers will produce 7,000 b/d of diesel fuel to be sold into a local market that has a demand for 75,000 b/d in the western North Dakota and eastern Montana markets. The 14,000 b/d that these two Energy Centers will produce are easily absorbed in the ever expanding Bakken region.”

Read more at quantum-e.com

 

Conoco’s Bakken Production Up 19% – Q2 2014

Lower 48 Liquids Production Volumes Increase 22% Thanks to Bakken and Eagle Ford
Conoco Phillips Bakken Acreage Map

Conoco Phillips Bakken Acreage Map | Click to Enlarge

Liquids production volumes from Conoco Phillips’ (COP) Lower 48 assets increased by 22% year-over-year thanks largely to the Eagle Ford and the Bakken, company officials reported in their second quarter 2014 report at the end of July.

COP production grew by 38% year-over-year to 208,000 boe/d in the Eagle Ford Shale and Bakken Shale plays combined. That’s ~39% of the company’s total production for its Lower 48 asset portfolio. In the Bakken alone, production grew 19% quarter-on-quarter from 43,000 boe/d to 51,000 boe/d. However, company officials expect for the rate of growth to slow in both plays in the second half of the year due to multi-pad drilling effects and weather-related issues in the fourth quarter.

Read moreConoco Phillips’ Bakken Ford Production Up 80% in Q4 2013 to 43,000 boe/d

Conoco’s EVP, Exploration and Production Matt Fox, said, “we expect to have multi pad drilling effects and are anticipating winter weather impacts in the fourth quarter. So the rate of growth will slow in the second half of the year. The net effect of this is we are still on track to achieve our 2014 volume targets for both the Eagle Ford and Bakken but we do expect rates to flatten in third and fourth quarters and then begin to ramp up as we head in to 2015.”

COP company officials say previously announced spacing pilot tests are being implemented in the Bakken, and more opportunities are being identified to tighten up well spacing.

Read more at conocophillips.com

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