Why Bakken is a must-have in HK’s asset portfolio
In this article, we’ll discuss why Halcon Resources’ (HK) impressive growth has been a result of its aggressive pursuit to increase presence in some of the most prolific liquid-rich areas and to re-balance its asset portfolio.
The Bakken is a predominant oil-producing region. According to the Energy Information Administration, overall production in the Bakken has increased from ~180,000 barrels per day (or bpd) in 2007 to ~1.1 million bpd in August 2014, an increase of more than 600%. HK currently operates 169 wells in the Bakken and 51 wells in Three Forks.
Read about the latest oil and gas production trends in the Bakken in Market Realist’s article on Bakken Shale: Why it’s important to US crude oil production.
During 3Q14, HK operated three rigs in the Bakken/Three Forks shales in Williston. The company spudded 13 wells in total in this region. Compared to 2Q14, the average for 30-day Initial Production (or IP) rate increased 15% in 3Q14 in HK’s Bakken wells. One of the wells in Fort Berthold area during the quarter had an initial production rate of 4,381 barrels of oil equivalent per day (or boe/d), a new record for HK.
Halcon’s 4Q14 plans in Bakken
During 4Q14, Halcon expects to spud eight to ten gross operated wells in the Williston Basin with three rigs and plans to participate in 65 to 70 non-operated wells.
The oil and gas producers in Bakken include Continental Resources, Inc. (CLR), Hess Corporation (HES), and Whiting Petroleum (WLL). CLR’s total production is 135.92 thousand boe/d, WLL’s total production is 94.1 thousand boe/d, and HES’s total production is 336.17 thousand boe/d. Some of these companies are components of the Energy Select Sector SPDR ETF (XLE) and the Oil & Gas Exploration and Production ETF (XOP).