Report says up to 4.3 billion barrels of oil in Bakken shale

thestar.com ^ | April 11, 2008 | NA

[neverdem]

BISMARCK, North Dakota (AP) - The U.S. government estimated Thursday that up to 4.3 billion barrels of oil can be recovered from the Bakken shale formation in North Dakota and Montana, using current technology.

The U.S. Geological Survey called it the largest continuous oil accumulation it has ever assessed.

The Bakken Formation encompasses some 25,000 square miles (64,750 sq. kilometers) in North Dakota, Montana, Saskatchewan and Manitoba, in three layers. About two-thirds of the acreage is in western North Dakota, where the oil is trapped in a thin layer of dense rock nearly two miles (3 kilometers) beneath the surface. Companies use pressurized fluid and sand to break pores in the rock and prop them open to recover the oil.

North Dakota's entire oil production hit 137,000 barrels a day in January, the latest figures available. Industry officials believe the state's record production of 148,500 barrels a day, set in 1984, will be surpassed this year.

Donald Kessel, vice president of Houston-based Murex Petroleum Corp., said he believes the Geological Survey's assessment of how much oil can be recovered in the Bakken may be a little on the high side.

"That's a lot of zeros,'' Kessel said Thursday.

Kessel said his company was the first to get a producing well in the Bakken in North Dakota three years ago. The company now has about 20 producing wells.

The report released Thursday by USGS was done at the request of Democratic Sen. Byron Dorgan over the past 18 months.

A 1995 study by the USGS found 151 million barrels of oil could be recovered from the Bakken using technology at that time. "This is great news,'' Dorgan said of the new report. "This is 25 times the amount of the previous assessment.''

Oilmen have known for more than 50 years that the Bakken holds vast oil reserves, Kessel said. But the price has never pushed demand high enough to develop technology to capture the oil, he said.

According to Jim Ehrets, a Denver-based geologist with Headington Oil Co., of Dallas, it costs about $5 million (euro3.15 million) to drill a well tapping the middle Bakken, and companies need crude prices of at least $50 a barrel to make it economical. Even with crude prices now double that, "there still is a ton of risk,'' he said.

Oil companies began sharing technology about two years ago on how to recover the oil. The technology involves drilling vertically to about 10,000 feet (3,048 meters), then "kicking out'' for as many feet horizontally, while fracturing the rock to release the oil trapped in microscopic pores in the area known as the "middle'' Bakken.

Initially, companies had kept their technology secret, said Ehrets.

"Everybody was protecting their results while the lease play was still going on,'' he said. "Once it had been pretty well saturated and not much left to lease, there was cooperation in sharing information.

"I can't remember in my entire career that kind of cooperation,'' said Ehrets, an oil man for nearly 30 years.

Headington, which is based in Dallas, has about 150 wells working in the Bakken - about 100 of them in Montana - with plans to drill at least 100 more, Ehrets said.

The Geological Survey said about 105 million barrels of oil have been produced from the Bakken through last year. The Elm Coulee oil field in eastern Montana, near the North Dakota border, has produced about 65 million barrels of the total, said Rich Pollastro, a USGS geologist.

The Elm Coulee field was discovered in 2000, he said.

The study released Thursday by USGS does not estimate how much oil may be in the Bakken - only what the agency believes can be recovered using current technology.

Thursday's report did not cover the Canadian portion of the Bakken. Pollastro said a 2000 assessment found only about 15 million barrels of recoverable oil in that area using traditional vertical drilling.

Ron Ness, president of the North Dakota Petroleum Council, said the number of wells in the Bakken in North Dakota increased from about 300 in 2006 to 457 at the end of last year.-AP

[Squantos]

Any freepers that are oil workers or employees that can explain too me why all the wells are dug , oil found and then capped ?

[count-your-change]

Sen. Dorgan said on the Senate floor a few days ago that oil’s time had passed and that renewables should now be getting the big tax breaks. Now after USGS reports billions of barrels of oil in his state oil smells great.

[Who is John Galt?]

it only represents a 215 day supply for the US...we use 20 million barrels a day....nice to have, every little bit helps, but this is a little bit.

I have personally evaluated multiple oil fields in the 50-500 million barrel range, all but a few of which remain undeveloped (that means 'nonproducing') because the environmentalists insist that each one represents 'only' 2-25 days supply for the entire United States. You know what? I no longer recycle aluminum cans, or any other substance. Until those same environmentalists can show me that my soda bottles or soda cans (or any other recyclable objects) represent more than 25 days supply for the entire country, by their own standards, it's not enough for me to bother with...

[Who is John Galt?]

Any freepers that are oil workers or employees that can explain too me why all the wells are dug , oil found and then capped?

In my experience, there is a simple answer: left-wing political interference (i.e., the D@mocrat Party)...

[Big Horn]

If God would have put the oil in lakes so you could simply dip it out, we would have used it all by now.

[kms61]

considerably less than some of the wild predictions being thrown around in the last few weeks.

[Squantos]

Damn...........thanks !

[count-your-change]

There will be half a trillion dollars not sent overseas. How is that disappointing?

[Mike Darancette]

Now the North Dakota Demi Rat will be named an endangered species and all exploration will be stopped.

[I see my hands]

There is no deposit on copper yet people seem very eager to recycle it. When aluminum is rare it will be dear.

[GovernmentShrinker]

There’s something strangely profound about that ostensibly casual comment.

[Aria]

I was in Argentina in January and the price was the equivalent of $3/gallon.

In February I was in Mexico and the gas was the equivalent of $3/gallon.

I had figured Mexico at least would pay less...but no.

I looked up how much we use and here is what I found:

Consumption. Total petroleum consumption of liquid fuels and other petroleum products averaged 20.7 million bbl/d in 2007, essentially unchanged from 2006 (U.S. Petroleum Products Consumption Growth). Based on the projections of weak economic growth and record high crude oil and product prices, consumption of liquid fuels and other petroleum products is projected to decline by 90,000 bbl/d in 2008—a sharp reversal from the 40,000 bbl/d increase projected in the previous Outlook—then increase by 200,000 bbl/d in 2009. After accounting for projected increases in domestic ethanol production, U.S. petroleum consumption is projected to fall by 210,000 bbl/d this year. Gasoline consumption is projected to decline by 0.3 percent this year but increase by 0.9 percent in 2009. Distillate fuel consumption projected to shrink by 0.2 percent in 2008 before rising by 1.5 percent in 2009.

http://www.eia.doe.gov/steo

[Williams]

The democrats have FORCED the price of oil to skyrocket, while they complain about high prices, but they force us to abandon oil resources and to use far more expensive alternatives!!!

The Republicans can't explain this to people, and half of the republicans agree with it!!

[count-your-change]

I don’t work in the oil business. Do you think it’s possible that wells might be drilled as injection sites to keep oil flowing in nearby wells? Or that wells are being drilled to evaluate the field? Or that perhaps that not many wells are being capped? Anyone got better ideas?

[Milton Miteybad]

Any freepers that are oil workers or employees that can explain too me why all the wells are dug , oil found and then capped?

The term used in the industry is "plugged and abandoned," or "P & A'd," rather than "capped." And there are very few circumstances where what you describe would actually happen with an oil well, but two such instances are:

1. The well contains merely "shows" of oil, but nothing in commercial amounts that would justify completing the well. They'll abandon it as a dry hole in that event.

2. The well tests as a commercial producer, but there is no way to transport the production, i.e., no way to truck the oil out or no pipeline. In that event, the well is "shut in," (not "capped") until such time the oil can be transported off the lease. "Shut-in" is almost always a temporary situation, although some shut-in periods are longer than others; for instance, a discovery in deep water far away from existing gathering lines. It takes a while to build underwater pipelines.

Once a well is completed as a commercial onshore producer, however, the oil can be run to tanks and trucked out, so there's seldom any shut-in period associated with those wells.

If you have an oil well that is at the end of its productive life, and is squeezing out pints per day of production no matter what you do to it, you might abandon that well simply because it costs more to operate the pump jack than you get for the oil. P & A time.

[Squantos]

Thanks for the education Milton !......learning vs just giving up.........:o)

Stay safe !

[Milton Miteybad]

I don’t work in the oil business. Do you think it’s possible that wells might be drilled as injection sites to keep oil flowing in nearby wells? Or that wells are being drilled to evaluate the field? Or that perhaps that not many wells are being capped? Anyone got better ideas?

They do this all the time in enhanced recovery projects, such as waterflood units. They form a big unit, use the outside wells as injectors and the interior wells as producers. Been doin' it for 50 years now, give or take.

And you're right...not that many wells are being "capped." (See earlier terminology discussion.) If they can get any meaningful amount of oil out of a well, they're producing it. You don't do anything else in a high oil price environment such as prevails today. But just because there's a cased hole in the ground that produced oil at one time in the past doesn't mean that when you re-enter the hole you'll be able to re-establish production. Sometimes you can, others you can't. Depends on what kind of downhole damage the last operator left for you.

Getting an abandoned oil well to produce again isn't anywhere near as easy as flipping a switch or turning a valve, contrary to popular belief.

[count-your-change]

thanks!

[cherry]

have you been following this story?.....it seems as if I read earlier that there was 600billion barrels there.....

can anyone put what they found into perspective?...

[Will88]

“The Bakken’s oil reserve could contain as much as 200 billion to 400 billion barrels of oil, which makes the 1.6 billion barrels produced in all of state history so far seem a proverbial drop in the bucket.”

http://www.bismarcktribune.com/articles/2008/02/13/news/update/doc47b3651270330046876314.txt

I’ll say this latest news is disappointing after a previous thread where the 200 - 400 billion barrel figures were discussed. Where do such numbers come from? This could make one start believing all the stories of vast and known crude reserves in the US that are just capped and forgotten.

But I guess every little bit helps - if it’s finally drilled.