Northern Oil announced increased 2010 drilling guidance and provided an operations update related to drilling and completion activity in the Williston Basin Bakken and Three Forks play.
2010 DRILLING ACTIVITY
Since January 1, 2010, Northern Oil has spud 21.5 net wells. Northern Oil is currently participating in the drilling or completion of 90 gross Bakken or Three Forks wells, for an aggregate of 10.4 net wells currently drilling, awaiting completion or completing. Of those wells, 5.0 net wells are currently drilling but have not reached total depth, an additional 4.6 net wells have been drilled to total depth and are awaiting completion and the remaining 0.8 net wells are currently undergoing fracture stimulation to commence production.
Northern Oil now expects to spud approximately 24 net wells by the end of 2010, increased from previous guidance of 18 net wells. We believe the increase in expected wells is based upon the increasing rig count, which was at an all-time high of 155 drillings rigs in the North Dakota Bakken play as of October 11, 2010. Northern Oil's Chief Executive Officer, Michael Reger, commented, "We continue to experience an increased pace of drilling in the Bakken and Three Forks plays. In addition to allowing Northern Oil to consistently increase its production, increasing drilling activities have also allowed us to observe the impactful delineation of the Three Forks play in key counties of the Williston Basin."
2010 ACREAGE ACQUISITIONS
Northern Oil has acquired a total of 38,864 net acres year-to-date in the core of the Williston Basin Bakken and Three Forks play at a total cost of approximately $42.2 million. This represents an average cost of $1,086 per acre.
Northern Oil's Chief Executive Officer, Michael Reger, commented, "The scale and scope of the Bakken and Three Forks play continues to exceed our expectations. Our premier acreage position is turning to high-quality oil production more quickly than we have anticipated as the pace of drilling continues to accelerate. With the North Dakota rig count currently at an all-time high of 155 rigs, we expect the development of this exceptional oil resource play to continue at a robust pace. We are especially fortunate to be participating as a non-operating partner in the wells of many of the premier operators in this play. It has been exciting for us to watch the best practices evolve and improve as the innovations of our operators continue to increase efficiency and productivity. Based on excellent recent results in the Three Forks, we expect this play to continue to gain momentum as this additional producing horizon de-risks across the Williston Basin. Most importantly, we continue to strategically acquire non-operated acreage interests at what we believe are very compelling price levels. We intend to continue to exploit our ability to acquire acreage in this growing play as long as the opportunity exists. Our single focus continues to be growing our presence and production as a non-operating partner in the Williston Basin Bakken and Three Forks play."
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