U.S. shale drilling pioneer Harold Hamm fired back on Wednesday at critics who say the North Dakota oil fields where he made his name — and minted a fortune — have already seen their best days.
Some industry watchers say wells are running dry too quickly, producing too much gas and yielding too little oil in the Bakken, North Dakota's premier shale oil region.
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"Its demise was overexaggerated," Hamm told CNBC's "Squawk on the Street" on Wednesday. "The Bakken is back stronger than ever."
Bakken oil production has nearly rebounded to output levels prior to the 2014 collapse in oil prices.
The amount of oil produced per rig deployed by Bakken drillers is also rising. Shale oil drillers, who use advanced technology to wring oil and gas from rock formations, improved their efficiency throughout the United States during the downturn.
"The technology's worked better there than it has anywhere else. We're still in the third inning of the Bakken development," said Hamm, chairman and CEO of Oklahoma City-based driller Continental Resources.
Shale wells typically produce a burst of oil in their first year of production, but their output drops off quickly and then slowly tapers off.
"Sure, these wells fall off the first year, but let me tell you, they level out and make a lot of oil," Hamm said. "1.1 million barrels per well isn't bad in the Bakken, so those are great ultimate recovery numbers."
Among the critics of shale drillers is Jim Chanos, the closely followed short-seller who called the demise of disgraced power giant Enron. Last fall, his top investing idea at CNBC and Institutional Investor's Delivering Alpha Conference was betting that shares of shale oil drillers will eventually collapse.
Chanos specifically called out Continental Resources, in part because of its growing output of natural gas, which drums up less cash than crude oil. Overall, Chanos thinks shale drillers need to spend too much to replace depleted wells, saying capital spending consumes almost all of their earnings and leaves little cash to service their debt.
Shares of Continental Resources are up 60 percent to about $55 since Chanos made his call.
Some shale drillers started looking beyond the Bakken during the oil price slump of the last few years, turning to regions with lower-cost production.
However, some private equity players are now picking up assets in shale fields that have fallen out of favor, including the Bakken, according to Houston-based oil and gas advisory firm PLS.
Dealmaking in the Bakken ticked up from $1.9 billion in 2016 to $2.6 billion last year, largely fueled by a single deal.
Bruin E&P Partners, backed by private equity firm ArcLight Capital Partners, spent $1.4 billion in July to acquire Bakken assets from Halcon Resources. The purchase was one of the top 10 biggest upstream U.S. oil and gas deals of 2017, according to PLS.
