Activist investing and special situations for the retail side.

Best Bakken Bet

Added on by Lee Ho Fook.

Be sure to check out our detailed stock analysis (click here). The Bakken Shale in North Dakota has been one of the best-producing oil fields over the last decade, with no signs of slowing down. This means the M&A market is heating up for companies looking to get into the area before production tops out. Major pipeline companies, including TransCanada, Oneok and Kinder Morgan have plans to put in pipelines for transporting oil/gas out of the Bakken, which should make the E&P companies in the area even more attractive and lead to higher valuations. So which companies are the best players in the area?

A couple pure plays (having the majority of their assets in the Bakken) on the shale includes Kodiak Oil & Gas (KOG) and Oasis Petroleum (OAS). As far as acquirers, the big oil and gas majors could be looking to get into the market, of which, Hess, ConocoPhillips Statoil and Marathon are already in the Bakken and could be interested in spreading their footprint.

Bakken Past. The three biggest tight oil shale plays in the oil and gas industry includes Bakken, Eagle Ford and Niobrara. The Niobrara shale has been steadily increasing for the past few years, while the Bakken has really accelerated production over the past few years. One of the most underappreciated shale plays is the Eagle Ford shale, really only coming into the tight-oil scene over the past couple years, but proving very fruitful.

The Bakken has been so productive, in part, thanks to new developments in oil and gas extraction, namely marked achievements in fracking. Back in 2006, North Dakota was ninth in the U.S. with regards to oil production. Come 2010 they were up to fourth, and then in mid-2012 North Dakota became the second largest producer behind Texas.

The Bakken also has the possibility of becoming one of only six oil fields that have reached the one million barrels per day mark. The Bakken as a whole is producing some 750,000 barrels of oil per day.