$OXY - Occidental Petroleum has a Permian focus. The majority of U.S. unconventional dollars are focused on Texas and California, but the Bakken has seen improvements. Occidental has not accumulated acreage in the best areas of North Dakota, but has focused on central and western Dunn County.
The middle Bakken is not at its thickest here, but the Three Forks is quite good. Further south, it is focusing on the Pronghorn. Occidental is realizing improved well costs throughout all of its U.S. acreage.
From 2012 to 2013, the Williston Basin has seen a 32% decrease. This was the best percentage of all U.S. plays for Occidental. Its drilling program is now planned months in advance. This not only decreases costs associated with downtime, but it has been able to decrease the number of hours needed to complete the wells.
It has decreased the number of strings of casing. It has switched its cemented liners for slotted liners. Occidental is optimizing water usage, by using flow back-end or produced water on completions. Stimulation contracted costs are also headed lower.
Four months ago, Occidental Bakken well costs averaged $10 million. Today the average is $8.2 million with a goal of $7.5 million. In 2013, it will run 6 to 7 rigs.
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