Paul Killinger

5 Oil Stocks You Want to Know - Barron's

Mr. Meyer,

How do their potential reserves per share in the Bakkens stack up against the reserves per share of other publicly traded oil companies, if I may ask?


On Feb 26 03:16 PM Philip Meyer wrote:

> In trying to capture what the Bakken shale play can mean to Brigham
> Exploration (BEXP) I am reminded of the little boy who was found
> madly digging into a pile of horse manure. Asked what he was doing
> the little boy said "With all this horse ---- there's bound to be
> a pony some place around here". Suffice to say, Brigham has the potential
> to find a lot of ponies given its steadily increasing Bakken position,
> now totally over 200,000 net acres. Relative to share price, Brigham's
> Bakken exposure is potentially staggering. Conservatively, the company's
> position should lead to a doubling of reserves over the next two
> years. Longer term, its Bakken exposure has the potential to increase
> reserves an order of magniture or more if Leigh Price's resource
> assessment of the "Bakken Source System" proves as reasonable as
> it is exhaustive" (a). Using Price's low-end estimate of 271 billion
> barrels of Bakken oil-in-place and a 10% recovery factor , Brigham's
> position could generate some 11 barrels of reserves per share. This
> jumps to 20 barrels per share using using Price's high-end estimate
> of 503 billion barrels of oil-in-place. Increasing the recovery factor
> to 20%, not unrealistic over time given the learning curve improvements
> typical of resource plays, reserves could again double to 40 barrels
> per share. Assuredly, there will be slips between the lip and the
> cup, as has already been the case. On the other hand, given the enormous
> size of the cup there is a huge margin for error.