Concentrating

In Montana in a “forgotten corner of the Williston Basin,” a Texas company is gathering up acreage with the expectation that it can turn what some call the False Bakken into a true gem. And if that doesn’t work, northeast Montana has more to offer in and near the Bakken Petroleum System.

Canadian drilling is reviving, but producers are switching targets by turning away from natural gas and concentrating on oil as their prices stay on diverging courses. The new focus for hydraulic fracturing techniques is “tight oil.”

Canadian drilling is reviving, but producers are switching targets by turning away from natural gas and concentrating on oil as their prices stay on diverging courses. The new focus for hydraulic fracturing techniques is “tight oil.”

Quest Resource Corp., which had been concentrating its exploration efforts in the Cherokee Basin of Kansas and Oklahoma, is expanding into the Marcellus Shale after agreeing to buy privately held PetroEdge Resources LLC for $140 million. PetroEdge, whose exploration is focused in the Appalachian Basin across West Virginia, Pennsylvania and New York, controls about 78,000 net acres that hold estimated proved reserves of 99.6 Bcfe. Current output is about 3.3 MMcfe/d. Nearly 67,000 of the net acres are in the heart of the Marcellus Shale play, with nearly 41,000 net acres spread across Ritchie, Wetzel and Lewis counties, WV; 22,000 net acres in Lycoming County, PA; and 3,000 net acres in Steuben County, NY. Quest Resource is said to be the largest producer of natural gas in the Cherokee Basin of southeastern Kansas and northeastern Oklahoma, where it controls about 560,000 net acres. Quest Resource terminated an agreement in May to acquire Pinnacle Gas Resources Inc., which would have given it a position in the Rocky Mountains (see NGI, Oct. 22, 2007), and said it would pursue Marcellus Shale opportunities instead. Combined with its existing acreage and development rights in the Appalachian Basin, Quest Resource said it would own the right to develop 119,000 net acres within the region once the PetroEdge acquisition is completed. Closing is expected by mid-July.

A diversified energy and communications company moving toward concentrating solely on energy operations, Rapid City, SD-based Black Hills Corp. said Thursday that its board of directors voted to make President/CEO David Emery the chairman of the board, effective immediately. He replaces Chairman Daniel Landguth who retires next month. A 15-year veteran with the company, Emery joined the board in January 2004 and before becoming CEO headed the retail services division and before that (1997-2003) he was responsible for the company’s fuel resources operations, including coal mining and oil/natural gas exploration and production. Landguth leaves the board May 25, after serving as Black Hills’ chairman for the past 14 years.