Natural gas company Williams has completed a major purchase in North Dakota's Bakken oil play from private owners for $925m in cash.
The company purchased 100% of the interests in Dakota-3 E&P Company, which has approximately 85,800 net acres on the Fort Berthold Indian Reservation in the Williston Basin and 3,300 barrels per day of net oil production from 24 existing wells.
Dakota-3 will continue its existing contractual arrangement for services with the contract operator and field services provider.
Currently, Dakota-3 has three rigs operating on its acreage and Williams expects to double the current level of drilling activity to six rigs by 2012, subject to permitting.
Williams estimates that Dakota-3’s holdings represent approximately 185 million barrels of oil equivalent in total net reserves potential in the Middle Bakken and the Upper Three Forks formations.
Williams’ entry into the Bakken Shale play follows its entry into Pennsylvania’s Marcellus Shale, where the company has accumulated approximately 100,000 net acres over the past year and a half.