Kodiak Oil & Gas Corp (USA) (KOG), And 2 Big Threats to Canadian Oil Sands Producers

That doesn’t mean Kodiak Oil & Gas Corp (USA) (NYSE:KOG) is twice as efficient as Suncor Energy Inc. (USA) (NYSE:SU). Rather, it reflects the weaker economics of Canadian oil sands production, as compared to tight oil production in the Bakken. While labor and other operating costs in Alberta’s oil sands have climbed steadily higher, operating costs in the Bakken have actually been declining over the past year and a half.

For instance, Continental Resources, Inc. (NYSE:CLR), the largest leasehold owner in the Bakken, said its average well costs last year fell to $8.2 million, a decrease of about $1 million from the previous year. Similarly, Kodiak Oil & Gas Corp (USA) (NYSE:KOG) reported a 15%-20% decline in average well costs for 2012, which fell to $9.7 million-$10.2 million.

The article 2 Major Threats to Canada’s Oil Sands Producers originally appeared on Fool.com.

Motley Fool contributor Arjun Sreekumar has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

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