They have been a significant oil production state for a long time. That is why Cushing storage and pipeline terminals exist. They are one of several states who have begun seeing an increase in oil production.
Posted on 10/22/2013 3:00:17 PM PDT by ckilmer
Oklahoma is emerging as the next big shale oil play, with production growing faster than in any other U.S. state apart from Texas and North Dakota.
(Excerpt) Read more at reuters.com ...
Oil output has doubled since the start of 2010, from 160,000 to 320,000 barrels per day, and is showing the sort of exponential growth that characterised other big shale plays (Charts 1 and 2).
Like Texas and North Dakota, Oklahoma is an old, established oil- and gas-producing state. The state has produced more than 15 billion barrels of oil since 1900, according to the Oklahoma Tax Commission and the Oklahoma Corporation Commission (OCC), which regulates the industry.
In 2009, the state's landscape was punctured by more than 32,000 oil wells, almost 9 percent of the U.S. total. Only Texas (with 142,000 wells) and California (with 49,000) had more.
Conventional crude output has been declining continuously since the mid-1980s owing to falling pressure in the oilfields and lack of investment.
But since 2005, output has started to rise again, as investment, drilling and workovers have risen in response to increased oil prices.
More recently, the increase in output has accelerated, as exploration and production firms begin to drill into the enormous Woodford shale formation that lies underneath large parts of the state.
****************************************
Chart 1:
Chart 2:
****************************************
According to the U.S. Energy Information Administration (EIA), there are three highly prospective shale plays in the state: the Ardmore, Arkoma and Cana basins, all of which contain parts of the Woodford formation.
Baker Hughes rig counts show there were 32 rigs drilling for oil in the Ardmore and Cana basins in mid-October, up from just six at the same point in 2011.
Continental Resources, the leading shale oil producer in the Williston Basin beneath North Dakota and Montana, revealed last year its next big target for development is an area southeast of the Cana play it has dubbed the South Central Oklahoma Oil Province (SCOOP).
SCOOP is a world-class resource, according to the company, with an oil-rich shale formation up to 400 feet (122 metres) thick. Continental estimates SCOOP contains up to 70 billion barrels of oil in place.
While the company has an obvious interest in talking up prospective production from the acres it has already leased, its optimistic estimates for North Dakota's Bakken have proved more accurate than many more conservative forecasters.
Continental has already leased 277,000 acres (112,000 hectares) in the area, either on its own or in combination with other developers, according to a presentation it made available to investors in October and available on the company's website.
The company has participated in the drilling and completion of 93 wells, and is busy delineating the oil-, gas- and liquids-rich parts ("fairways") of the play, as well as identifying the most productive areas.
The company's share of output from those wells hit 17,550 barrels of oil equivalent per day in the second quarter of 2013, up more than 400 percent compared with a year earlier.
State oil output is now rising rapidly, up by more than 50,000 barrels per day since the start of the year, though the increase stalled in June and July.
Continental has one of the most successful track records in the shale business.
The company has pioneered a highly efficient, assembly-line approach to drilling and fracturing in the Bakken formation that cut costs and raised production quickly. It claims to be able to achieve rates of return of over 20 percent on a typical shale well with prices as low as $60 per barrel.
If Continental can bring the same approach to SCOOP, the state's oil and liquids output is set to rise rapidly.
Oklahoma has other attractive petroleum-rich tight oil formations, such as the Mississippian, which have already attracted strong interest from other specialist shale production companies, notably Devon Energy, the pioneer of shale production in Texas.
The state is ideally located for a big increase in production. Unlike remote North Dakota, Oklahoma is already crisscrossed by an extensive network of oil-gathering pipelines and hosts the country's major crude storage and trading hub at Cushing, with 80 million barrels of storage capacity and extensive links to refineries in the Midwest and Gulf Coast.
I’d never heard before that Oklahoma had this much oil.
SCOOP is a world-class resource, according to the company, with an oil-rich shale formation up to 400 feet (122 metres) thick. Continental estimates SCOOP contains up to 70 billion barrels of oil in place.
.............
if true—this has to mean that the permian basin with oil up to 3500 feet deep has several hundred billion barrels of oil.
http://www.reuters.com/article/2013/10/18/shale-usa-idUSL6N0I819G20131018
Bump for later
“the Ardmore, Arkoma and Cana basins”
Are any of them in Beaver county?
That could be one of the if the not the biggest oil fields in the country.
They have been a significant oil production state for a long time. That is why Cushing storage and pipeline terminals exist. They are one of several states who have begun seeing an increase in oil production.
if true—this has to mean that the permian basin with oil up to 3500 feet deep has several hundred billion barrels of oil.
Don't think that all shales are equal. Thickness does not automatically equal volume of oil that can be released with only fracturing.
yeah I know oklahoma has alwasys been an oil producing and that its oil production is rising.
What’s new is this.
SCOOP is a world-class resource, according to the company, with an oil-rich shale formation up to 400 feet (122 metres) thick. Continental estimates SCOOP contains up to 70 billion barrels of oil in place.
70 billion barrels?
eagle ford is said to have only 35 or so tops and the baaken maybe 15 billion barrels. apples to apples —70 billion barrels is huge...
You are comparing oil in place to technically, economically recoverable oil.
Bakken has over 500 billion barrels in place, if I remember correctly.
Oklahomans: “We don’t need no stinkin’ pipeline”
yikes
A draft study by the late organic geochemist
Leigh Price provides estimates ranging from 271 to 503 billion barrels (mean of 413 billion) of potential
resources in place. The study represents Dr. Price’s work as it stood at the time of his death in August 2000. It
was conducted while he was working for the USGS, but it did not receive a complete scientific peer review by
the USGS and was not published as a USGS product
..............
however, later USGS estimates still put “recoverable” oil in the bakken at less than 15 billion.
so its hard to know what to think here. maybe its just a matter of technology. the more technology improves—the more oil becomes available for extraction. also price, as long as the price holds up lots of oil is available for extraction.
In shale, not all of the oil is “free”. Some of that is really Kerogen or the like and requires retorting to release it from the shale. And that takes a whole lot more energy and cost.
So just like known proved reserves increased when the price went from $20 to $100, likewise it will further increase as we get to $500, assuming it isn’t all loss in dollar value.
And technology. There is one study that showed injecting controlled amounts of oxygen and igniting it would release more oil for production. I hope that route is never approached, but technology will continue to make changes.
So just like known proved reserves increased when the price went from $20 to $100, likewise it will further increase as we get to $500, assuming it isn’t all loss in dollar value.
..............
The greater likelyhood is that the long term direction of oil prices is down in the USA because of rising production and falling demand—that is if TB Pickens and his plan for shifting trucks and busses over to natural gas —comes to fruition. Seems like that’s the case as he’s putting in lots of natural gas stations and lots of companies are shifting over to natural gas for their vehicles.
The increased oil production is due to the relatively high price of oil. Any significant price drop is going to have a following production drop from our shale fields. Long Horizontal laterals with two or three dozen drag stages are not going to be produced at the present rate if that happens.
Just like the demand curve varies with price, so does the supply.
Speaking of which, looks like about 98 bucks.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.