Marathon Oil's Bakken Production Holds Flat in Q3 - Drilling Faster

Marathon Oil Bakken Map

Marathon Oil's Bakken production held flat at 38,000 boe/d in the third quarter as the company shut in production to complete adjacent wells. Compared to the third quarter of 2012, production is up 27%.

Flat production from one quarter to the next isn't a knock on Marathon, it's going to happen with the expanded use of pad drilling. Unless operators stagger their pad drilling perfectly (near impossible), we'll see lumpy production additions going forward.

“Marathon Oil achieved strong financial results in the third quarter, delivering $1.44 billion in operating cash flows before working capital changes, and adjusted net income of $617 million, 29 percent higher than the second quarter,” said Lee M. Tillman, CEO. “All three business segments performed well, capturing the higher liquid hydrocarbon realizations both domestically and internationally, compared to the second quarter.”

Marathon hit total depth on 21 gross wells and brought 21 gross wells to production during the quarter. The 2013 exit rate for production is estimated at 40,000 boe/d.

The company's average drilling time for each well fell from 15 days in the second quarter to 14 days in the third quarter. That's 20% faster than one year ago.

Marathon also discussed successful results in the Three Forks. The company is targeting the upper portion of the play and expects to explore the lower benches in 2014. Marathon has drilled 58 Three Forks wells to date and the formation accounts for more than 20% of the company's production in the region.

Read the full release at marathonoil.com

Halcon's Bakken IP Rate Improved Dramatically in the Third Quarter

Halcon Bakken Drilling Spacing Unit

Halcon Resources' initial production rates have improved considerably across the Bakken. The company is completing wells with tighter stage densities, more proppant per stage (100% ceramics), and is using slick water in areas where gels were used in the past.

The company's best well to date was completed on the Fort Berthold Reservation in the third quarter. The Bakken well came online 3,914 boe/d.

Wells completed with the company's latest design have yielded results 20-60% better than comparable wells.

“Third quarter results were defined by continued expansion of our activities in the Williston Basin, El Halcon and other areas.”

— Floyd C. Wilson, CEO

Spud-to-total depth drilling times have fallen below 18 days at both the company's Fort Berthold and Williams County properties. Approximately 80% of drilling in 2013 and 100% of drilling in 2014 will be multi-well pads.

Halcon spudded 14 wells and completed 13 wells in the third quarter as net production increased 40%. The company will operate 5-6 rigs in the fourth quarter and 4-5 rigs in 2014.

The company continues to test downspacing across the play and the lower benches of the Three Forks. The first Three Forks Second Bench well is being drilled currently.

Downspacing tests at 660 ft/well have proven promising. The three Bakken wells tested at 660 ft spacing in the unit depicted above all came online at more than 2,500 boe/d. Halcon is planning the majority of Bakken development on the Fort Berthold Reservation at 660 ft spacing and plans to drill downspacing pilot tests in Williams County in 2014.

Halcon has 132 producing Bakken wells, 39 producing Three Forks wells, and 14 wells in various stages of drilling and completion.

Read the company's full Q3 press release at HalconResources.com

NRP - Sundance Reach $35.5 Million Bakken Deal

Natural Resource Partners (NRP) has agreed to acquire non-operated working interests in the Bakken from Sundance Energy for $35.5 million. 

“This is NRP’s second acquisition of producing, non-operated working interests in the Bakken/Three Forks play, which will grow and further diversify NRP’s revenue going forward.”

— Nick Carter, NRP's COO.

The deal includes 77 producing wells and associated acreage in Dunn, McKenzie, and Mountrail counties. All leases are held by production. NRP plans to participate in future development on the properties.

Read the full release at nrplp.com

SM Energy Grew Bakken Production 9% in the Third Quarter

SM Energy Bakken Map

SM Energy grew Bakken production volumes from 13,700 boe/d in the second quarter to 14,900 boe/d in the third quarter.

The company completed 13 gross wells and is producing 35% more than it did at this time last year.

SM has three rigs running, with a focus in the Gooseneck, and Raven/Bear Den areas. SM Energy has 162,000 net acres prospective for the Bakken and Three Forks, but is focused on development of 81,000 net acres.

The company made two comments related to testing in the play:

• Downspacing results will be considered in planning at year-end
• Evaluating alternate completion designs being used in the play - Current design utilizes a 26-stage sliding sleeve completion and 80,000 barrels of fluid.

Read the company's full third quarter press release at sm-energy.com

Hess' Bakken Production Grows by 14% & Well Costs Fall 18%

Hess' Bakken Acreage Map

Hess Corp has grown Bakken production by 14% and driven well costs down 18% over the past year.

The company is producing more than 70,000 boe/d from the region and is on target to meet full-year 2013 guidance of 64,000-70,000 boe/d from the Bakken.

In the third quarter, Hess brought 50 wells to production, while spending $579 million in the play. The company has now completed 122 wells to date in 2013.

The average well was drilled and completed during the quarter at a cost of $7.8 million or 18% less than the same period in 2012.

The Bakken accounts for 19% of Hess' production and 23% of the company's reserves.

Read the full press release at Hess.com