Vermilion Energy Buys Bakken Assets in Saskatchewan - $345 Million

March 21, 2014 Kirk Eggleston

Vermilion Energy purchased $345 million in Saskatchewan acreage and other assets in mid-March 2014 from an undisclosed seller. With the acquisition, Vermilion establishes a long sought after core area in the Williston Basin. The assets include some Bakken and Three Forks properties.

“In a company statement, Vermilion officials stated, “we have been evaluating producing entry opportunities into this prolific area for an extended period of time, but had not previously been able to structure a transaction that met the stringent requirements of our dividend growth model.”

Vermilion Acquisition Details

Assets include approximately 57,000 net acres of land (approximately 80% undeveloped) covering the Midale, Frobisher, Bakken and Three Forks/Torquay formations. Production from the assets is projected to be approximately 3,750 boe/d (97% crude oil) during 2014. More than 90% of the current production base will be operated by Vermilion.

Vermilion Drilling and Development from Acquired Assets

The majority of production and development drilling opportunities from the acquisition will be from the Midale formation, with additional opportunities in the Frobisher, Bakken and Three Forks/Torquay formations. The company has identified 175 (152 net) potential drilling locations collectively targeting these formations. Total proved and proved plus probable reserves attributed to the Assets at the end of February 2014 were 10.3 mmboe (81% crude oil and natural gas liquids) and 16.5 mmboe (81% crude oil and natural gas liquids), respectively.

North Dakota Campaign Seeks to Grow Workforce for In-Demand Jobs

March 19, 2014 Kirk Eggleston

North Dakota officials announced a new workforce recruitment campaign aimed at attracting a permanent private-sector workforce to keep pace with the state's growing economy. The “Find the Good Life in North Dakota” campaign is targeting people in states with chronic unemployment, and people in industries that are high-demand in North Dakota, including: engineering, healthcare, energy, skilled trades, transportation and information technology.

The campaign is set to launch in May 2014.

Visit the BakkenShale jobs page

The Bakken Shale oil boom has been the primary reason for job growth in the state. Well-paying opportunities in the oil patch have been plentiful, attracting workers from across the country; however, the growth of the workforce has caused some issues over the past several years. Housing shortages, particularly near Williston, ND, which is considered to be the epicenter of the oil boom, have caused the price of rent to shoot through the roof. Crime and other factors affecting quality of life near the oil patch have also been cause for concern among locals and workers relocating to the area for well-paying opportunities.

Despite the growing pains caused by the boom, N0rth Dakota leads the nation in job growth, and the state's campaign hopes to continue that trend.

“In a statement released by the North Dakota Economic Foundation, Lt. Governor, Drew Wrigley, said, “To sustain [our] growth, we need to ensure that the jobs we are creating are filled with highly-skilled workers, and this campaign is a tremendous opportunity to expand our workforce and promote the quality of life that North Dakota has to offer.”

The campaign is also placing an emphasis on attracting veterans and active military transitioning to civilian life and employment.It is estimated that 250,000 service men and women will be exiting the armed forces in the coming years and the campaign will invite them to start their next career in North Dakota.

The State of North Dakota has provided $400,000 in matching funds to launch the project.

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.

Nearly Half of Halcon 2014 Budget Targeting Bakken - ~$475 Million

March 3, 2014 Kirk Eggleston

Halcon is focused on drilling wells in the Fort Berthold area in 2014 and anticipates spending approximately 49% of its total drilling and completions budget in the Williston Basin. Based on previous budget estimates, that's about ~475 million.

The company's plan for 2014 is to focus on its "de-risked" acreage, which includes the Fort Berthold area.

“Floyd Wilson, CEO, said in a company statement, “our focus in 2014 is on drilling wells in the sweet spots of our de-risked acreage in the Williston Basin and El Halcón. We will also begin drilling wells on our newly acquired acreage located in what we believe to be the core of theTuscaloosa Marine Shale. We are primed for growth and have a deep drilling inventory. We are committed to maintaining capital discipline and dedicated to improving capital efficiency.”

Halcon's 2014 Bakken Guidance

In the first-quarter of 2014, Halcon anticipates weather-related production interruptions in the Bakken.

For the full-year, the Company plans to operate an average of 4 rigs and spud 40 to 50 gross operated wells. Halcon also anticipates participating in 200-225 gross non-operated wells, with an average working interest of 3%.

Halcon's Fourth-Quarter Bakken Production

In the fourth-quarter of 2013, Halcon Resource's Bakken production increased by 15% over the third-quarter to 24,125 boe/d, despite adverse weather conditions. Company estimates accounted for weather-related impacts of ~1,040 boe/d.

Halcon's Fourth-Quarter Bakken Activity

Halcon operated an average of five rigs in the Bakken, and participated in 50 non-operated wells, with an average working interest of 3% in the fourth-quarter of 2013.

In the Fort Berthold area, the company spudded eight wells and broutght 10 wells online. For some of Halcon's Fort Berthold area wells, strong results came from the application of the "slickwater frac" technique. The company plans on continuing this practice in 2014.

“At Winter NAPE, Wilson, was quoted, “[the company’s] most recent wells in the Bakken are the best ever.”

Halcón also spudded four wells and put two wells online in Williams County in the fourth-quarter.