Wednesday, September 25, 2013

Goldman Sachs: "Bakken shale production will surprise Wall Street" and Carl Icahn does a drive-by (CLR; OAS; ARII; TRIN)

It appears that despite the extraordinary decline rates of individual wells the overall field has some productive time ahead of it.
And this is with current technology. Should the well service companies adopt the British approach* the sky is the limit.
One fact to be aware of, both CLR and OAS are trading at all-time highs. Goldman put Oasis on their "Conviction buy List"

We like all-time highs though; because a) big winners tend to set a lot of them (duh) and b) by definition there are no shareholders doing their deals with the Gods of Equities, "Please, if you just let me get back to breakeven I'll ______ " (double duh)

Although the chart doesn't show it, production from the field will cross 1mm bbl/day, almost all from widely spaced wells in the middle Bakken, by year end.

From MarketWatch:
North Dakota’s Bakken shale formation will surprise investors, analysts at Goldman Sachs wrote in a note Tuesday.

“We came away from our trip to North Dakota last week with greater confidence in our outlook that Bakken production/completion activity will likely exceed Street expectations,” the analysts said.
Goldman picked favorites among oil exploration and production companies exposed to the Bakken: they initiated coverage of Continental Resources Inc.  CLR  and Oasis Petroleum Inc.  OAS , rating both a buy based on their growth potential and valuation. They set a price target of $130 on Continental stock and $65 on Oasis Petroleum stock.

Other firms ready to reap the Bakken benefits are refiner Northern Tier Energy LP  NTI , oilfield-services firm Halliburton Co. HAL , and transportation and pipeline companies Canadian Pacific Railway Ltd. CA:CP  and Enbridge Inc. ENB .

Northern Tier’s price target was set at $30 a share, while Halliburton’s target was $63 a share. Enbridge and Canadian Pacific’s targets were 54 Canadian dollars and 144 Canadian dollars, respectively....MORE
Fracking In England: You Either Love It or Hate It
WARNING: The 'reveal' at the end of the post is disgusting.
Let's just say "Microbial injectate"....
Mr. Icahn also likes the Bakken. From Platts:
Icahn creates new US railcar JV, cites growing oil movements