Northern Oil And Gas Inc's Business Segments

We are an independent energy company engaged in the acquisition, exploration, development and production of oil and natural gas properties, primarily in the Bakken and Three Forks formations within the Williston Basin in North Dakota and Montana. We believe the location, size and concentration of our acreage position in one of North America’s leading unconventional oil-resource plays will provide drilling and development opportunities that result in significant long-term value. Our primary focus is oil exploration and production through non-operated working interests in wells drilled and completed in spacing units that include our acreage. As a non-operator, we are able to diversify our investment exposure by participating in a large number of gross wells, as well as entering into more project areas by partnering with numerous experienced operating partners. In addition, because we can elect to participate on a well-by-well basis, we believe we have increased flexibility in the timing and amount of our capital expenditures because we are not burdened with various contractual development agreements or a large operating support staff. Further, we are able to avoid exploratory costs incurred by many oil and gas producers.

Deploy our Capital in a Conservative and Strategic Manner and Review Opportunities to Bolster our Liquidity. In the current industry environment, maintaining liquidity is critical. Therefore, we will be highly selective in the projects that we fund and will review opportunities to bolster our liquidity and financial position through various means.

Continue Participation in the Development of Our Existing Properties in the Williston Basin as a Non-Operator. In the current price environment, we believe the best way to develop our acreage is to take a long-term approach and develop our locations with potential for the highest rates of return. We plan to continue to concentrate our capital expenditures in the Williston Basin, where we believe our current acreage position can provide an attractive return on the capital employed on our multi-year drilling inventory of oil-focused properties.

Diversify Our Risk Through Non-Operated Participation in a Large Number of Bakken and Three Forks Wells. As a non-operator, we seek to diversify our investment and operational risk through participation in a large number of oil wells and with multiple operators. As of December 31, 2016, we have participated in 2,914 gross (213.1 net) producing wells in the Williston Basin with an average working interest of 7.3% in each gross well, with more than 35 experienced operating partners. We expect to continue partnering with numerous experienced operators across our leasehold positions.

Evaluate and Pursue Value-Enhancing Acquisitions, Joint Ventures and Divestitures. We will continue to monitor the market for strategic acquisitions that we believe could be accretive and enhance shareholder value. We generally seek to acquire small lease positions at a significant discount to the contiguous acreage positions typically sought by larger producers. As part of this strategy, we consider areas that are actively being drilled and permitted and where we have an understanding of the operators and their drilling plans, capital requirements and well economics. In addition, we have increasingly taken interest in and will continue to evaluate the acquisition of non-operated producing properties as a means to grow and/or bolster our credit metrics.

Maintain a Strong Balance Sheet and Proactively Manage to Limit Downside. We strive to remain financially strong, yet flexible, through the prudent management of our balance sheet and active management of commodity price volatility.

Northern Oil and Gas Inc. is a prominent player in the exploration and production sector of the North American oil and gas industry, primarily focused on the Bakken formation in North Dakota. The company operates as an independent oil and natural gas company, engaging in the acquisition, exploration, development, and production of crude oil and natural gas.

Segments

1. Exploration and Production (E&P):
- Upstream Operations: Northern Oil and Gas is heavily invested in upstream operations where they explore for and produce oil and gas. Their assets primarily include working interests in a significant number of horizontal wells in the Bakken region.
- Asset Acquisition: The company focuses on acquiring strategic acreage and working interests in existing wells. This strategy allows them to leverage the existing infrastructure while minimizing exploration risks.

2. Joint Ventures and Partnerships:
- Collaborative Development: Northern Oil engages in joint ventures with other operators to mitigate financial risk and enhance resource extraction. These partnerships often enable them to pool resources for large-scale development projects.
- Strategic Alliances: The company seeks alliances that align with its operational goals, allowing shared expertise in geoscience, engineering, and project management.

3. Infrastructure and Logistics:
- Midstream Activities: Beyond upstream operations, Northern Oil may engage in activities related to midstream logistics, including the transportation and storage of crude oil.
- Investment in Infrastructure: A focus on enhancing pipeline infrastructure and connectivity to refineries can improve efficiency and reduce costs associated with getting oil to market.

Products

1. Crude Oil:
- Northern Oil and Gas primarily produces light, sweet crude oil, which is favorable due to its lower sulfur content and greater ease of refining. This type of crude oil is often sold at a premium relative to heavier crude due to its desirable characteristics.

2. Natural Gas:
- Although the companys core focus is on oil production, natural gas is also extracted as a byproduct of oil operations. This resource can be sold on the market, generating additional revenue.

3. NGLs (Natural Gas Liquids):
- NGLs may also be produced, providing another revenue stream. These include ethane, propane, butane, and natural gasoline, which have various applications in the petrochemical industry and as fuel sources.

Services

1. Land and Lease Management:
- The companys operations involve strategic management of leased land, ensuring compliance with regulatory requirements and maximizing production efficiency.

2. Production Optimization:
- Northern Oil employs advanced technologies and methodologies in its production processes, including enhanced oil recovery techniques, to maximize output from its wells.

3. Environmental Stewardship:
- Creating sustainable practices is integral to Northern Oil’s operations. The company focuses on minimizing environmental impacts through responsible drilling practices and adherence to environmental regulations.

4. Community Engagement:
- The firm engages with local communities and stakeholders to ensure that their operations contribute positively to regional economic development while addressing concerns and promoting awareness of the industry’s activities.

Strategic Focus Areas

- Technological Innovation: Investment in new technologies for drilling, completion, and well management processes to boost efficiency and production rates.
- Sustainability and ESG Initiatives: Emphasis on environmental, social, and governance (ESG) factors to enhance sustainability practices, reduce carbon footprints, and engage with stakeholders positively.
- Market Positioning and Expansion: Continuously evaluating opportunities for expansion through acquisitions or partnerships that enhance their asset portfolio and market reach.

In summary, Northern Oil and Gas Inc. presents a robust offering through its focus on crude oil production predominantly in the Bakken region, complemented by natural gas and NGL production. The company’s operational segments, alongside its emphasis on strategic partnerships and innovative technologies, position it as a significant entity in the oil and gas sector. Their comprehensive approach to land management, production optimization, and community engagement further illustrates their commitment to operational excellence and responsible resource development.