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TheStreet Open House

Halcon Resources Is Betting on the Last American Shale Oil Play

NEW YORK (TheStreet) -- Halcon Resources (HK) has been getting most of its output from Bakken formation, but this could start changing from next year when the company will begin pumping oil from Tuscaloosa Marine Shale, or TMS, the last remaining major American unconventional oil play.

Halcon Resources is a small, independent energy company valued at $2.3 billion with significant operations at two shale formations: Bakken - Three Forks in North Dakota and El Halcon in Eagle Ford East Texas. Furthermore, Halcon Resources is one of the few oil producers that are betting big on the rise of TMS as a major shale oil play which stretches from South Louisiana to Southwest Mississippi.

Halcon Resources' shares ar up 38.2% this year, currently hovering around $5.50.

READ MORE: 10 Stocks Carl Icahn Loves in 2014

Halcon Resources has nearly 120 million barrels of oil-weighted proved reserves, of which more than 75% are located at Bakken while most of the remaining are at El Halcon. In an email to TheStreet, the company's Vice President for investor relations Scott Zuehlke said that Halcon Resources' growth has been driven by its assets at the Bakken and Eagle Ford formations and this trend will likely continue in the coming years.

In its previous quarterly results which came out last week, the company's production, which consist of mainly oil and natural gas liquids, increased by 44.2% from last year to more than 42,000 barrels of oil equivalents per day. This growth was driven by 87% and 453% increases in production from Williston Basin at the Bakken formation and El Halcon respectively. Around 67% of the company's output came from the former and 22% from the latter.

The company swung to a loss of $73.3 million from a profit of $36.3 million a year earlier but this was on the back of $106 million non-cash loss on oil derivatives. Excluding the impact of one-off items, the company reported net income of 7 cents a share, up from 4 cents a share a year earlier.

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