Brian Michaud and Tyler Kocon, Split Rock Private Trading
Covestor models: Bakken Shale, Equity Rotation
Over the past several years, the face of the oil and gas industry has undergone some significant changes.
Traditional oil drilling (vertical) has taken taken a back-seat as exploration and production companies turn to a new method of drilling that allows the operators to uncover vast amounts of oil and natural gas hidden in the porous rock lying miles beneath the surface.
The issue erupted in the early 1900’s when early oil prospectors realized that oil reserves below the surface were not always straight down. Sometimes, they were positioned awkwardly beneath areas where traditional vertical drilling was not possible.
Innovations had to be made, and quickly the practice of directional drilling was spawned and thus ushered in a completely new era for land-based oil exploration and production companies. Difficult and sometimes unreachable oil reserves were now able to be extracted.
This directional drilling technique eventually led to the advent of truly horizontal drilling. This modern breakthrough now allowed producers to drill completely underneath vast oil deposits and institute another revolutionary technology that has taken the domestic oil and natural gas production industry to new heights.
Horizontal drilling paved the way for hydraulic fracturing to become a regular and frequent process. Hydraulic fracturing allows exploration and production companies to drill underneath massive shale rock formations, in which contain multiples of porous “pockets” that contain oil and natural gas reserves. The fracking process combines millions of gallons of water, other chemicals, and hundreds of tons of sand into a slurry that is forced down well bores under high pressure. This pressure causes fissures in the shale formations that allows the oil and natural gas to escape from their containers and flow into the well bore and up to the surface for processing.
It is this process that has revolutionized the domestic oil and natural gas landscape. Now, exploration and production companies are able to tap incredible amounts of previously unreachable oil reserves that are situated across a large majority of the nation.
Without this technology, the immense oil reserves currently being extracted from shale areas like the Bakken, Eagle Ford, Marcellus and Haynesville shales would never have been possible.
Hydraulic fracturing and horizontal drilling have provided a key to unlocking some view of what hopefully ultimately becomes American energy independence. That view would likely have never been possible without the advent of horizontal drilling: a truly remarkable breakthrough in the oil and natural gas drilling industry.
Tyler Kocon, portfolio manager of the Bakken Shale separately managed investment account, has established himself as one of the experts in companies that use unconventional oil and natural gas extraction technologies.
The Bakken investment model is an attempt to capture some of the incredible growth and innovative changes occurring throughout the domestic energy environment by incorporating companies that practice horizontal drilling and hydraulic fracturing among the shale deposits located in North America.
To learn more about Tyler’s model, call Covestor, at 866-825-3005, X 703, from 9 to 5, Monday through Friday, Eastern. You can ask for Bhargav in our New York office. He can help you determine if the Bakken investment model might be right for you.
He can also set you up with your own separately managed account (your money is separate from everyone else’s) with a low investing minimum.
