Denbury and Exxon have announced a deal that includes almost 200,000 acres in the Bakken trading hands. Exxon is paying and trading $1.6 billion dollars in cash, operating interests in the Webster Field in Texas, and interests in the Hartzog Draw Field in Wyoming for 196,000 acres in the North Dakota Bakken play.
Denbury is trading its Bakken assets that were largely acquired through the acquisition of Encore for cash and fields with CO2 tertiary flood potential. CO2 floods are the company’s focus and a deal for the Bakken assets has been expected for some time. XTO Energy, an Exxon subsidiary, will operate the Bakken assets.
Denbury Acquiring CO2 from XOM
In a separate agreement, Denbury will either purchase CO2 from the LaBarge Field from XOM or will purchase an interest in reserves in the field. The $1.6 billion in cash from Exxon will be reduced by the amount of the CO2 agreement.
Tertiary Flood Opportunity Expands in WY & TX
The Hartzog Draw Field (370 mmbbls OOIP) is located near the Greencore Pipeline that runs from Conoco’s Lost Cabin plant to the Bell Creek Field in Southern Montana. The company estimates the field has ultimate potential net recovery of 20-30 million barrels.
The Webster Field (550 mmbbls OOIP) is located just 8-miles from the company’s Green Pipeline that delivers CO2 to the Hasting Field south of Houston. DNR estimates the Webster field has ultimate potential net recovery of 60-75 million barrels.