Powder River Basin News Pulse October 2022

Posted: December 7, 2022

The Powder River Basin | October 2022

Field Overview

The Powder River Basin, known for its coal deposits, is located in Southeast Montana and Northeast Wyoming. The basin is named so because it is drained by the Powder River. Major cities in the area include Gillette and Sheridan, Wyoming and Miles City, Montana. There is a recent resurgence in oil and gas production as a result of horizontal drilling and hydraulic fracturing. This resurgence is occurring mainly in the Wyoming part of the basin, which is historically known as the source of the basin’s oil.


State Drilling Statistics

Total Rigs in Wyoming- 24 (+2)
Total Rigs in United States – 784 (+15)
Total U.S. Rigs 37% YTD

State Permitting Data
Permits Approved – 42

Powder River Top Producer

Top Producer – Continental Resources


Basin Highlights

BLM Announces Next Oil and Gas Lease Sale in Wyoming

The BLM announced that 251,000 acres will likely be included in the next Wyoming lease sale. Recent Biden-era federal lease requirements will be in effect on these leases: the minimum bid will be $10/acre instead of $2/acres, the royalty rate on the leases will be 16.67%, and rental rates will be higher. The announcement of this lease sale was hailed by pro-development Wyoming Governor Mark Gordon who said, “The announcement of this lease sale is welcome news.”

Juniper Capital, Boomtown Form Largest Northern DJ Basin Leaseholder

Juniper Capital and Boomtown, two financial holding companies with oil and gas assets, recently combined two of their portfolio entities, North Silo Resources and Longs Peak Resources, into North Peak Oil and Gas, a Northern DJ Basin operator. This new corporation has 150,000 net acres and over 11,000 boe/d. Most of the new company’s leaseholds are on Wyoming fee acreage which affords very low regulator risk and limited government interference. 

Continental Resources Accepts Hamm’s Go-Private Offer

Continental Resources, one of the largest leaseholders in the Powder River Basin, has announced that it has accepted its founder and president Harold Hamm’s offer to take the company private. Hamm will be purchasing the remaining outstanding shares of Continental Resources at $74.28/share, which is up from the original $70.00/share that Hamm proposed originally in June of this year. Hamm and his family already own 83% of the shares of CLR and this upcoming purchase will take the remaining shares out of public circulation.

Large Oil Project Asks to Inject Wastewater into Wyoming Aquifer

Dallas-based Aethon Energy is seeking permission from the EPA for wastewater injection permits for the Moneta Divide project. The target injection zone is the Madison, which exists at 12,000’ in this part of the Powder River Basin. Environmentalists criticize the project for being a potential source of groundwater contamination whereas Aethon’s engineering and geology staff and several in the EPA and Wyoming Oil and Gas Conservation Commission dismiss such claims.


Most Permit Approvals by Operator

RankCompanyPermits
Approved
1Anschutz Exploration24
2Hadley/Jackson Energy LLC5
3Continental Resources4
4 (Tied)Devon3
4 (Tied)EOG3

Top Producers – Oil

RankCompanySeptember Oil Production (MBO)
1Continental Resources911
2EOG883
3Anshutz Corp747
4Devon578
5Crescent Energy Company466

Top Producers – Gas

RankCompanySeptember Gas Production (MMCF)
1Denbury7,052
2Carbon Creek Energy5,281
3EOG5,117
4Continental Resources3,159
5Occidental1,567

Rig Count



Wyoming Oil Production


Wyoming Gas Production


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The information contained in this newsletter is provided by RARE
PETRO Engineering, PLLC via the following sources unless otherwise
noted:

www.eia.gov
www.drillinginfo.com
www.bhge.com
RARE Petro Analytics

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