In a US$590 million deal (including US$50 million in stock), Kodiak Oil & Gas has acquired an additional 50,000 net acres in the Bakken play. The company announced that, following this transaction, its Williston Basin land position will rise to 155,000 net acres.
This is the fourth acquisition tracked by GES that Kodiak has made in the Williston since late 2010. A total of 103,000 estimated net acres were acquired in these four deals at a combined cost of US$1 billion or US$9,908 per net acre. The two most recent deals (both made this year) included significant existing production.
Seen as a process of consolidation of smaller interests, Kodiak's acquisitions illustrate a broader trend that is likely to continue in the Bakken and other unconventional resource plays. For a variety of reasons this consolidation makes operational sense. Kodiak's string of deals also has the effect of increasing its attractiveness to other potential acquirers in the future.