Permian Basin operators were a hot draw at Enercom's The Oil and Gas Conference held in Denver in mid-August, but Bakken players likewise turned on the burners for investors. Whiting Petroleum Corp., Continental Resources Inc. and Oasis Petroleum Inc. each presented impressive economics over the four days of company presentations.

In the operations realm, larger fracs and a higher-density drilling program have helped push Whiting's production to 93,400 barrels of oil equivalent (BOE) per day, up 16% year-over-year.

Referring to the company's PV-10 value of some $10 billion (for 3P reserves), Jim Volker, chief executive officer, said, “Talk about changes or good things for the balance sheet and the ability to drive forward—we have production, reserves and cash-flow growth simultaneously.” Its Rockies production was 69,900 barrels of oil equivalent (BOE) per day for the second quarter.

Fortifying its balance sheet is the recent sale to BreitBurn Energy Partners LP of Whiting's enhanced-oil-recovery projects in Postle and Northeast Hardesty fields, in Texas County, Oklahoma. Volker called this a “transforming transaction” that delivers $850 million net to Whiting.

“How many people ever, in their lifetime, can say they sold 11% of their assets and paid off over half of their debt?“ he asked. “Well, we did it. Thank you.”

The deal sets the company up for expansion in the Bakken as well as in the Niobrara.

“Of our $2.15-billion bank line after the sale, we've only used about half, so we have about $1.2 billion available to ramp up,” he said. “And, we've only added about $300 million to the drilling budget for the northern Rockies, the Permian, and ramping up the Red Tail project in eastern Colorado for the Niobrara. Our total capex budget for 2013 is about $2.5 billion.”

Of Whiting's drilling inventory of about 10,000 locations, 48% are in the Bakken, and about 30% are in the Niobrara.

“Why do we love the Bakken?” he asked. “When we go out and spend about $8.5 million per well, and find just short of 700,000 BOE per well, and net over $60 per BOE—now approaching $70—as an EBITDA margin, you can see we're doing about five- to six-to-one on our money every time we put our bit in the dirt.”

Whiting is focused on developing the Middle Bakken, the Pronghorn sands and the First and, in some cases, the Second Bench of the Three Forks. It has 700,000 net acres in the Williston Basin overall.

Even at Sanish and Parshall fields, where the Bakken play sparked, Whiting has 450 locations remaining across its 82,000-net-acre position. It has initiated a high-density pilot there and is downspacing, which could add three Middle Bakken wells per 1,280 spacing unit. It also plans to refrac several wells at Sanish in 2013.

Take-away capacity looks good in the Bakken, he said. Including rail, capacity is more than 2 million barrels, and most projections show production peaking at 1.5 to 1.7 million barrels per day.

Williston Basin pure player Oasis Petroleum Inc. was also chipper. Year to year, its production, 90% oil, is up 22%.

With 335,000 acres in the Bakken/Three Forks, and 280 spacing units, it has 14 years of inventory. And, about 87% of its acreage is held by production. “If we execute on 145 wells a year, that's 14 years of inventory,” said Tommy Nusz, chairman and chief executive officer.

While its second-quarter activity flattened some with the winter break-up, Nusz said that the company will ramp up in the second half of the year. Its total capex budget is about $1 billion for 2013, and given declining service costs and efficiencies on the operating side, he said the company will accomplish the same amount of drilling—about 128 gross wells completed—at a cost that is $100 million less than in 2013. Its well costs will average $8 million by year-end, he said, and it is running 11 rigs.

With the bulk of its blocks held by production, it's moving into pad development and testing of infill wells—60% to 70% of its wells are currently on pads; next year, 90% will be on pads. Of the some 140 wells it spuds this year, 95 to 100 will be in pilot density-spacing units. Twenty-two separate spacing units will be tested for infill density this year, with infill pilots completed on the majority of its acreage by year-end.

As for financial strength, there is plenty of it: an undrawn borrowing base of $1.25 billion, not including an upcoming redetermination. It had liquidity of $1.4 billion as of the end of June.

Bakken big boy Continental said it is “tightening 2013 production targets up to 38% to 40%,” while holding to its nonacquisition capex budget target for the year of $3.6 billion, according to president Rick Bott. Its Bakken production was 88,000 BOE per day for the second quarter, and it posted a record $708 million in EBITDAX for the quarter.

Bott said it was still “very early days” in delineating the lower Three Forks benches and figuring out premium well spacing. Still, he said the lower Three Forks has a potential productive footprint of 3,800 square miles.

“We're spending a lot of capital on this, and seven other operators have downspacing pilots, so we will all be learning a lot over the next 12 to 18 months,” he said. The company is currently drilling a 14-well pad.

Continental set a goal for midyear 2013 of driving well costs below the average for the industry. “The average for the industry was $11.3 million, and our average is $9.2 million,” he said. “We would like to knock another $1 million off that, to $8 million. That is where we see efficiencies and the opportunity to expand margins.”

If Continental takes its locations from 10,000 to 20,000, as it expects to through increased density, and drills 350 net wells per year, it has three decades of running room. “Our five-year strategy is to triple production, and all we need to do that is to have the First Bench (of the Three Forks) work,” Bott said. To achieve its five-year goal, it must hit 300,000 barrels per day.

During the remainder of 2013, the company will drill the rest of its deeper tests to the Second, Third and Fourth benches of the Three Forks. Its first 320-acre downspacing pilot should yield some results soon, Bott said.

The money and operating acumen being directed at the Bakken/Three Forks today is staggering. These combined initiatives “just make the pie bigger,” Bott said.

—Susan Klann