U.S. Energy Corp. and Abraxas Petroleum Provide Bakken Operations Update

April 11, 2014 Kirk Eggleston

U.S. Energy Corp. and Abraxas Petroleum released operational updates this week in the Bakken. The two companies interests are not connected.

U.S. Energy Corp. and Abraxas Petroleum are also active in the Eagle Ford Shale play in South Texas.

Abraxas Petroleum Williston Basin Operations Update

Abraxas is active in McKenzie County, ND. The company's Jore 1H, 2H and 4H are scheduled for fracking, following the completion of an Eagle Ford well. Abraxas owns a working interest of 76% in these wells.

On Abraxas' first Middle Bakken downspacing test, Raven Rig #1 successfully drilled and cased the surface and intermediate sections of the Ravin 6H and Ravin 7H. The company is now drilling the intermediate sections of the Ravin 5H, which will be followed by the intermediate section of the Ravin 4H. Abraxas owns a working interest of 51% in its' Ravin West pads.

“Bob Watson, CEO of Abraxas, said in a company statement,”in the Bakken, weather has abated and we plan to be on location in the coming weeks to frac our three well Jore pad. Drilling continues to run quite smoothly on the Ravin pad. Success on this initial downspacing test obviously carries with it significant reserve and inventory implications for the company.”

U.S. Energy Corp. Williston Basin Operations Update

U.S. Energy Corp. has interests across 84,480 gross (3,225 net) acres in Williams, McKenzie and Mountrail Counties, North Dakota. At the end of 2013, the company had participation in 101 gross (10.7 net) Bakken and Three Forks formation producing wells. Due primarily to weather-related issues in North Dakota, the company's Williston Basin production decreased by ~24% during the first two months of 2014 to an average of ~ 625 boe/d as compared to 817 boe/d in the fourth-quarter of 2013.

Marathon Accelerates Activity in The Bakken and Other US Domestic Plays

March 26, 2014 Kirk Eggleston

Marathon's Bakken and Three Forks Acreage Map

Marathon is continuing to ramp up its presence in US domestic shale plays, with increased activity expected in the Bakken Shale through the end of 2014. In a company statement in late March 2014, officials revealed that Marathon hit its target of a 28-rig program across the Eagle Ford, Bakken and Oklahoma-Woodford Shale plays at the end of January.

“Marathon Oil’s CEO Lee Tillman said, “We continue to have high confidence in our ability to deliver on our North America long-term production growth targets underpinned by strong resource growth through downspacing and well optimization. In addition, we are progressing the evaluation and appraisal of co-development opportunities with the Eagle Ford’s Austin Chalk and the Bakken’s deeper Three Forks benches.”

Marathon Bakken Operations Update

According to Marathon, the company's Bakken acreage accounts for ~800 mmboe in proven and probable reserves and resource potential. As of March 2014, Marathon had a 6-rig drilling program, and anticipates 75 - 85 net wells across the play in 2014. The company also expects to complete 20 - 24 net wells by the end of the year. The Bakken budget for 2014 remains at approximately $1 billion and 29% of the company' 2014 capital budget.

Marathon Targeting Deeper Three Forks Benches in Myrmidon Area

The Three Forks First Bench accounts for ~23% of proven and probable reserves. 45 gross operated wells are planned for the Three Forks in 2014. Six wells are planned in the lower benches of the Three Forks between 2014 - 2015. The initial focus will be on the Myrmidon area.

Magnum Hunter Bakken 2014 Capital Budget - $52 Million

March 24, 2014 Kirk Eggleston

Magnum Hunter sold off its non-core Eagle Ford assets in 2013. In 2014, the company is focusing on its core Appalachia and Williston Basin areas. $52 million of the company's $400 million capital budget will be spent in the Williston Basin in 2013. 65% of the budget will be spent on the company's Appalachia assets.

“In a company statement, Magnum Hunter CEO Gary Evans said, “we made the decision to sell our Eagle Ford assets [] for a contracted price of $401 million and redeploy those proceeds to our two remaining core areas, Appalachia and the Williston Basin. Revenues were still up over 72% and EBITDAX increased 48%. We drilled 21 gross wells (12.5 net) in the Marcellus and Utica resource plays and drilled 72 gross (24.6 net) in the Bakken and Three Forks Sanish plays of the Williston Basin.”

Magnum Hunter Bakken & Three Forks Fourth Quarter Operations

In the fourth-quarter of 2013, Magnum Hunter drilled 15 gross (6.2. net) in the Bakken/Three Forks formations. In its operated areas, the company drilled 2 wells, and in non-operated areas, 13 gross (4.2 net) wells were drilled.

Initial production (IP) rates varied across the company's Williston Basin acreage. In the Middle Bakken Formation, six two-mile lateral wells completed, with an average 24-hour IP rate of 561 boe/d and a 30-day rate of 389 boe/d. Two one-mile laterals were also completed in the Middle Bakken. At the end of the year, one well had a 24-hour IP rate of 680 boe/d and a 30-day rate of 253 boe/d. In the Three Forks/Sanish Formation, seven two-mile lateral wells were completed, with an average 24-hour IP rate of 584 boe/d and a 30-day rate of 287 boe/d. One one-mile lateral was also completed in the Three Forks/Sanish. It had an a 24-hour IP rate of 760 boe/d and a 30-day rate of 282 boe/d.

Magnum Hunter 2013 Bakken & Three Forks Capital Spending

Upstream capital spending in the Williston Basin during the fourth-quarter was $19.7 million in 2013. For the full-year, the company spent $131.8 million. That was ~43% of the company's total upstream capex budget for the year.

Emerald Oil Increases Bakken Production by 80% in 2013

March 14, 2014 Kirk Eggleston

Emerald's total production increased by 80% in 2013 over 2012 from ~935 boe/d to ~1690 boe/d. The production increase was attributable to the addition of 10.58 net operated Bakken and Three Forks wells in 2013.

Since the beginning of 2013, the company has acquired ~67,700 net acres. The most recent Bakken acreage acquisition took place in January, and cost Emerald $74.6 million.

Emerald's Bakken Fourth-Quarter Production and 2013 Reserves

Emerald had a strong fourth-quarter in the Bakken, with average daily production of 2,430 boe/d.

“McAndrew Rudisill, Emerald’s CEO, stated, “2013 was a transformational year for Emerald. We successfully drilled and completed multiple Middle Bakken and Three Forks wells, tripled our operated acreage position and monetized the majority of our non-operated assets.”

t the end of 2013, Emerald had total proved reserves of ~13.2 mmboe, all of which were located in the Williston Basin. Emerald's proved reserves increased approximately 147% during 2013 primarily as a result of our successful operated well program.

Emerald's Bakken 2014 Drilling and Production Strategy

In 2014, Emerald has plans to add another rig to it's drilling program. The company expects to achieve an exit rate of 4,250 boe/d, with an average production rate of 3,550 boe/d.

“In a company statement, Rudisill, said, “in 2014, our production will continue to grow as we add a third rig to our drilling program. The third rig is currently moving to location in our Easy Rider focus area and will soon begin drilling, earlier than originally anticipated. Due to the strong performance of our Low Rider Middle Bakken wells and positive indications from our Low Rider Three Forks wells, we are actively reviewing increased downspacing assumptions and raising our stated Low Rider type curve. We are very focused in 2014 on lowering operating expenses and driving greater drilling and completion cost efficiencies.”

Emerald plans to add an additional 18.2 net operated wells by the end of 2014.

Newfield Bakken Production Increases 40%, Exceeds 2013 Estimates

March 6, 2014 Kirk Eggleston

Newfield Williston Basin Production Chart

Newfield's Bakken net production in 2013 was ~4.4 MMBOE or ~12,000 boe/d. That's a 40% increase over 2012 production. At the beginning of 2013, the company had only estimated a production growth rate of 15% year-over-year in the play.

In 2014, Newfield will continue its current 4 rig program, and expects to achieve 35% to 40% year-over-year production growth. Capital expenditures are set at $330 million for 2014.

“In a company statement, CEO Lee Boothby said, “in 2013, we twice raised production guidance and once again, exceeded our guidance ranges in the fourth quarter, both domestically and internationally. The 2013 production from continuing operations was 40.1 million barrels of oil equivalent, exceeding our beginning-of-year estimates. The outperformance was primarily related to the Williston and Anadarko basins. ”

Newfield Bakken and Three Forks Activity in 2013

In the Bakken and Three Forks region, Newfield completed 42 wells and lowered average well costs to $8.4 million. The company drilled eight wells in the Three Forks. Seven test wells targeted the first bench and one was drilled in the second bench. The company indicates that it will continue testing these prospective horizons beneath the Middle Bakken.

In the Middle Bakken, 34 wells had an average gross initial production (IP) of 2,233. In the Three Forks, eight wells had an average gross initial production (IP) of 2,091.

Newfield Highlights

Newfield's Bakken net production increased 40% in 2013 to ~12,050 boe/d
Newfield completed 42 wells and lowered average well costs to $8.4 million
Newfield Three Forks drilling tested seven wells in the first bench and one well in the second bench
In the Middle Bakken, 34 wells had an average gross initial production (IP) of 2,233 in 2013
In the Three Forks, eight wells had an average gross initial production (IP) of 2,091
In 2014, Newfield expects to achieve 35% to 40% year-over-year production growth.