More early results from Niobrara oil drilling in Colorado and Wyoming will be revealed in quarterly earnings calls this month, as investors pant for news of home runs on their bets, some of them placed as long as a year ago, when the play first surfaced in industry headlines.

An early winner is Noble Energy Inc.'s #01-99HZ Gemini-K in Weld County, Colorado, that made 160,000 barrels of oil equivalent (BOE), mostly oil, in its first seven months online. Completed with a 16-stage frac, it was making more than 400 BOE per day in early November, roughly 35% liquids.

The well is about 50 miles southwest of EOG Resources Inc.'s #2-01H Jake, which made 50,000 barrels of oil in its first 90 days. EOG, which holds some 400,000 acres over Niobrara, also had initial production rates of between 700 and 750 barrels per day from its Critter Creek #5-10H and #9-15H on restricted chokes. The wells are in a heavily fractured area of the play, notes Mark Papa, chairman and chief executive.

"So, the initial production rates are going to be quite good. The question is, 'What will those production rates look like six and 12 months after the initial rates?' We just need more time to watch," he warned analysts in December.

Also in Weld County, Carrizo Oil & Gas Inc. reported in early January that its State 16-11-9-60 flowed more than 690 barrels per day at controlled rates, stabilizing at some 530 per day. Meanwhile, fracture stimulation was to begin at press time on its Bob White 36-44-8-62. Carrizo owns approximately 60,000 net acres over Niobrara in the Denver-Julesburg Basin.

Others drilling the formation include Chesapeake Energy Corp., PetroQuest Energy Inc., Stone Energy Corp., Bill Barrett Corp. and St. Mary Land & Exploration Co. St. Mary has a horizontal discovery in Silo Field, where its #1-19H Atlas in Laramie County, Wyoming, tested between 1,200 and 1,500 barrels a day.

PetroQuest reported two Niobrara tests in early December on its 5,000 net acres in southern Wyoming. Nevis #2, which made some 865 BOE, 96% oil, in its first 24 hours, was flowing 407 barrels per day a month later. It has a 5,300-foot lateral and was completed with 20 frac stages.

Meanwhile, PetroQuest deemed its Peterson #1 non-commercial. Some 15 miles away, the well, with a 340-foot shorter lateral and as many frac stages, penetrated Niobrara in a "quiet area" that lacks natural fracturing. The wells cost some $4.5 million each. PetroQuest plans as many as 15 more in 2011, these near previously drilled vertical wells where logs show high resistivity, indicating natural fractures.

Michael Hall, senior analyst for Wells Fargo Securities LLC, says, "The (Peterson) result offers a somewhat negative data point for the Niobrara, given the non-commercial test of quiet rock, reinforcing some views that the play will not be nearly as blanketed as that of the Bakken."

But, it's just one example, he says, and much more remains to be revealed as the play develops.

Bill Barrett suggests tempered exuberance. It plans to test the shale under its southeastern Wyoming acreage this year. Chris Pikul, senior analyst, E&P, for Morgan Keegan Equity Research, says, "Management is cautious on industry enthusiasm for the Niobrara, where high-profile, publicly announced wells need to be balanced with what are less-encouraging data points from across the play.

"The Niobrara remains a bit of a question mark, but additional industry evaluation will shed some light on this high-impact play in 2011."

The Niobrara rig count isn't suggestive of a hot play, with just 16 at work at year-end. However, as more well results are revealed, no-shows for early acreage will aim to buy in. Chesapeake was taking bids for a joint venture at press time over its more than 800,000 acres. Aubrey McClendon, chairman and chief executive officer, estimates the acreage holds unrisked recoverable resources of some 4.6 billion barrels of oil.

Dan Pickering, co-president and head of research for Tudor, Pickering, Holt & Co. Securities Inc., says Niobrara acreage will get swept up in oily corporate E&P transactions this year. "2010 saw a bunch of shale joint ventures that started gassy—Haynes­ville, Marcellus—and shifted to oily—Eagle Ford. The next deal will be Niobrara."

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