Disclosure: I am long KOG. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Denbury's (DNR) divesting of its Bakken acreage was no surprise. It has built a very good business around EOR in the Gulf Coast and Rockies regions. Denbury's acquisition of Encore provided EOR acreage, but also a large Bakken leasehold. Denbury has run a decent Bakken program which has provided oil production growth to its steady EOR production. Since it purchased the acreage, costs have increased. These increases have led to lower IRRs, which has hurt margins. Historically, its EOR F & D costs have been lower than the Bakken, but it doesn't provide the large increase in oil production.

Exxon (XOM) paid $1.6 million for 196000 net Bakken acres. This acreage is estimated to average 15000 Boe/d over the second half of 2012. This was a bargain for Exxon, as it also gave Denbury operating interest in Webster Field located in southeast Texas, and Hartzog Draw Field located in northeast Wyoming. Denbury has also agreed to purchase CO2 reserves. Webster Field is currently producing 1000 Boe/d with 86% being oil. Denbury is the operator of Webster, holding 99.4% working interest. Hartzog Draw Field is currently producing 2600 Boe/d with 52% being oil. It has working interest in two zones, one 83% and the other 67%. READ FULL ARTICLE HERE