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Michael Filloon  

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  • Bakken Update: Whiting's Extensive Refrac Inventory May Provide Significant Upside [View article]
    Douglas Ryan,

    Excellent question. The trick isn't as much the time frame as where the well was drilled. If we get outside core areas that are producing the best wells, these refracs probably are not feasible at all at todays prices. We would need to see oil prices between $60 and $70/bbl (very wide estimate, but tough to go over all of the areas here) to pick up very good areas that are on the fringe of core, and all areas outside that aren't feasible in our opinion. Going back to core, once we get passed 2013, many of the wells have been drilled using better completion designs, so the probability of finding enough shale that didn't get fractured would be limited at best. http://bit.ly/1si3hbl
    Apr 8, 2015. 11:13 PM | 1 Like Like |Link to Comment
  • Bakken Update: Whiting's Extensive Refrac Inventory May Provide Significant Upside [View article]
    runjmc2,

    Thanks! That is correct. This isn't a game changer, but more of a specific upside situation. Right now, I would guess economics are only good in the best fields and those that were drilled early. What we are focused on are completion improvements, as refracs in marginal areas will only be economic if those areas can be drilled and completed. EOG is well on its way to finding a system that works at sub $50/bbl in most good areas, but others are still far behind. Hopefully others can duplicate. http://bit.ly/1si3hbl
    Apr 8, 2015. 11:07 PM | 1 Like Like |Link to Comment
  • Bakken Update: Whiting's Extensive Refrac Inventory May Provide Significant Upside [View article]
    Hey g8tr,

    Thanks, sorry I don't have as many as I use to. I have been slaving over the numbers at the new job (no negatives here, as I really like it) and analyst work takes too much time. We only release some of the work to SA and the rest stays on the shaletrader site. I did catch those comments and found them very interesting. Not only was he speaking to Russia but to the US. Although we don't export, we do complete with our refined products abroad. I think the Saudis would like US production to decrease as well as that would open up sales to US refineries, with respect to its light oil. The biggest issue is the world economy. If it improves we would see demand pick up which would do much more for the glut than relying on production cuts.
    Apr 8, 2015. 11:02 PM | 3 Likes Like |Link to Comment
  • Bakken Update: Whiting's Extensive Refrac Inventory May Provide Significant Upside [View article]
    sparky,

    Thanks for the kind words, I really appreciate it. I didn't think you were being negative as I appreciate the input. I hope my comment wasn't disrespectful in anyway, we really crunch the numbers a lot on shale and when we kick this data around try to tie in how numbers could be affected no matter the circumstance. It is just so hard to cover every angle in these quick papers. You make very good points, as WTI has to come up especially for areas like the Bakken that have wider differentials. The fraclog is a little scarey as there are a large number of holes in the ground and anytime that pricing recovers we will probably see it head lower quickly. It is so easy for these operators to improve production in the short term, especially with inventories in the best areas. This is why we are seeing the wide swings in production each week from the EIA and why the API seems to miss so wildly on those same estimates a day earlier. This is going to be a problem for quite a while I would agree, and it will be more of a traders game than a long term investor. http://bit.ly/1si3hbl
    Apr 8, 2015. 10:55 PM | 5 Likes Like |Link to Comment
  • Bakken Update: Whiting's Extensive Refrac Inventory May Provide Significant Upside [View article]
    sparky58701,

    All very good points and there are a large number of variables to cover on a subject this large. It is very easy to take a couple of points and expand on those to paint a negative picture, but we work off of hard numbers and not statements that are not backed by those numbers. Just for arguments sake lets cram some numbers and see how it affects the specific wells modeled in this paper.

    We used a refrac cost of $2 million. Although you didn't provide a specific cost for a refrac in this area, lets say our estimates are wrong and the cost moves to $3 million. Payback times move from 5.2 to 7.6 months (this is an average as production would be levered to the front end, so results are probably better on a payback basis). If we keep the higher refrac cost and also add your assertion that production would lessen due to well communication with additional wells drilled per section. Obviously production would decrease depending on the number of wells per section, so we'll use a very aggressive number of 33% resource lost on a refrac. This would reduce the 360 day revenues from $3.1 million and $4.6 million. If we use the higher $3 million refrac cost, our payback times would move to roughly 8 to 12 months. I think it is great to get comments and questions, but keep in mind these numbers are excellent. We could even figure this at a much lower oil price and get good results as most operators would like to reach payback by 18 months at a minimum. If you would like to add more info on the subject that would be great, but the readers find it most helpful if one can back their assertions with data, as we are concerned with how it will affect specific investments. Thanks!
    Apr 8, 2015. 09:23 PM | 9 Likes Like |Link to Comment
  • Bakken Update: American Eagle's Well Results Spell Significant Issues If Oil Prices Don't Rebound Soon [View article]
    Noble Financial put a one cent price target on AMZG
    http://bit.ly/1ItaCiP
    Apr 8, 2015. 02:27 PM | Likes Like |Link to Comment
  • Bakken Update: EOG Antelope Well Has One-Year Payback At $50/Bbl WTI [View article]
    WALLY B GOOD

    EOG has always been pretty conservative about choking back its production in both oil and natural gas wells. They were probably one of the more conservative (tightest choke) when production began for them in the Bakken back in 2006 and carried an extremely tight choke up until about 2012 where they moderated some but was still more conservative than most. Oil producers were worried that a wide open choke would wreck a well, as seen in conventional production. Brigham and Oasis have tested this notion but it doesn't seem to cause any damage, but I think and open choke allows well pressures to decrease too quickly and this probably hurts production long term, but we don't have enough data to prove this. On well 20513 from this article, EOG used a 38/64. Even if EOG had used a very wide choke, it wouldn't have affected the longer term production much. Most believe this only affects 90 day data but as we get further out the production is lower in the months after so over time this evens things out some. Hope this helps and sorry it took so long to get back to you.
    Apr 5, 2015. 08:17 PM | 3 Likes Like |Link to Comment
  • Bakken Update: QEP Resources' Bakken Development Could Be Best In Play [View article]
    Hi Bart,

    The 19K/acre is what the geology or land is worth once we strip out infrastructure (pipelines, wells, etc.)
    http://bit.ly/1si3hbl
    Mar 29, 2015. 08:15 PM | 1 Like Like |Link to Comment
  • Bakken Update: Bakken Operators May Get $1 Billion Tax Break [View article]
    Fred,

    Yes you are correct. The tax is a shared burden so the holders would receive it as well.
    Mar 13, 2015. 02:34 PM | Likes Like |Link to Comment
  • Why to Buy This Bakken Pull Back? Production and Recovery Part 2 [View article]
    GVB,

    What specifically are you looking for? Are you just wondering what they are targeting?
    Feb 27, 2015. 07:36 PM | 1 Like Like |Link to Comment
  • Bakken Update: U.S. Crude Storage Capacity Is Filling Up, So Oil May Be Headed Below $40/Bbl [View article]
    We still continue to see oil prices steady, but production continues to increase. We are watching EIA numbers closely. More info can be found at Shaletrader in the link below.
    http://bit.ly/1si3hbl
    Feb 23, 2015. 01:00 AM | Likes Like |Link to Comment
  • Bakken Update: U.S. Crude Storage Capacity Is Filling Up, So Oil May Be Headed Below $40/Bbl [View article]
    Thanks TOT,
    Just have to wait and see if the inventories continue to pile up.
    http://bit.ly/1si3hbl
    Feb 19, 2015. 03:06 PM | Likes Like |Link to Comment
  • Bakken Update: U.S. Crude Storage Capacity Is Filling Up, So Oil May Be Headed Below $40/Bbl [View article]
    We get a very important number today at 10am where the EIA will give us the inventory number. If the API is correct with the crude inventory adds for this past week, it is the largest add since 1982 (that was when they first started keeping track of it).
    Feb 19, 2015. 09:51 AM | Likes Like |Link to Comment
  • Bakken Update: U.S. Crude Storage Capacity Is Filling Up, So Oil May Be Headed Below $40/Bbl [View article]
    TeaRex,

    I think with all of the economic issues over in that part of the world that a ceasefire would be bullish the price of oil. Normally conflicts push up the price but I think with all the issues with the Euro (and other currencies) and strength in currency, the best thing for oil prices (mostly affects Brent since WTI will trade on its own if we continue to add barrels) is no conflict. I don't think it is currently a significant issue given the supply driven market. When markets are driven by demand these things cause quick a large swings in oil price, but when oil is plentiful, we just don't see those types of moves.
    Feb 19, 2015. 09:45 AM | Likes Like |Link to Comment
  • Bakken Update: U.S. Crude Storage Capacity Is Filling Up, So Oil May Be Headed Below $40/Bbl [View article]
    GHOST,

    I could be wrong but I think the refiners are close to capacity so I think gasoline prices will go up. Right now those rates are low but that is because of seasonal downtime, but I don't think TSO can pick up the slack if that refinery is closed down for 6 months.
    http://bit.ly/1si3hbl
    Feb 19, 2015. 12:18 AM | Likes Like |Link to Comment
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