Kodiak provided a second quarter operations update, along with plans to spend more and produce more from the Bakken in the second half of the year. The increase comes as no surprise. Kodiak acquired Liberty Resources' Bakken acreage earlier in July 2013 for $660 million.
Kodiak's production at the time of the announcement was 34,000 boe/d. 28,500 boe/d from legacy assets and 5,500 boe/d from the recently acquired Liberty assets.
The update included the following 2013 guidance changes:
- Production guidance increases from 29,000-31,000 boe/d to 30,000-34,000 boe/d
- Capital spending will increase from a planned $775 million to $950 million to $1 billion
- The budget includes the completion of ~100 net wells
Kodiak's Second Quarter Bakken Activity
[ic-l]Kodiak participated in the completion of 48 gross (24 net) wells in the second quarter. Kodiak brought on a second full-time completion crew in May and plans to use a third crew temporary on its newly acquired lands. Third quarter activity is expected to include completing 30 gross (25 net) operated wells plus additional non-operated wells.
Kodiak was operating seven rigs in the area, dropped one in June, and then added a rig back through the recent acquisition. The company is running three rigs in the Polar area, two in the Smokey project, one at the Koala project, and one in Dunn County.
Wells on two 12-well units are nearing completion and one pad has eight wells already producing. Kodiak is testing 12 wells within a single 1,280 acre unit in both the Polar (Williams County) and Smokey (McKenzie County) areas. We should hear more in the third quarter.