Posted on 06/18/2008 10:10:46 AM PDT by Ernest_at_the_Beach
(CNSNews.com) - Reports circulating on the Internet tell of an oil field spanning parts of western North Dakota and eastern Montana where 400 billion barrels of oil supposedly are just waiting to be tapped. However, the U.S. Geological Survey (USGS) tells Cybercast News Service that those huge estimates are "a myth."
A USGS report issued in April estimates that there are between 3 billion to 4.3 billion barrels of oil in what is referred to as "the Bakken Formation" -- well below the 400 billion barrels discussed on the Web, but up from the previous estimate of 151 million barrels made in 1995.
Richard Pollastro, Bakken Formation task leader at the USGS, said the myth stems from a 1999 draft report -- never published -- by a now-deceased USGS employee, Leigh Price. Price estimated that the Bakken Formation holds up to 400 billion barrels of oil. To put that in perspective, Saudi Arabia, the world's largest oil producer, has about 260 billion barrels of known oil reserves.
Price, however, died in 2000, before his study could be peer-reviewed and published, and the Bakken Formation became the fool's gold of the oil industry.
"Unfortunately, in many instances, we are still trying to explain and defend our assessment versus the inappropriate and irresponsible posting of Dr. Price's 'draft report,'" Pollastro told Cybercast News Service.
According to Jonathon Kolak, a USGS scientist and information specialist, the discrepancy between Price's 1999 estimates and the agency's 2008 findings arises from the fact that Price was trying to assess the "oil generation potential" of the oil found in the pores of rocks and shale in the Bakken field, as well as the total content of how much oil might be pooling up - or "oil in place."
"What Dr. Price was looking at was 'oil generation potential,' and then, from that, trying to make an estimate of 'oil in place,'" said Kolak. "Those terms are very distinct from 'undiscovered technically recoverable resources.'"
The latest study, which was commissioned by U.S. Sen. Byron Dorgan (D-N.D.), is an estimate of how much "technically recoverable" oil and gas is available -- i.e, how much oil can actually be recovered using today's technology.
Kolak also explained that the 25-fold increase between the 1995 estimates and the 2008 assessment is due to two factors: an improved understanding of the geology and advances in drilling technology.
"Our understanding of the geology improved significantly because of the time difference between the studies," he said. "There has been some drilling since then, there has been a lot more information that has come out, other people have conducted studies, and also USGS researchers have conducted studies."
Moreover, drillers are utilizing directional drilling in the Bakken fields, a way of drilling at an angle to tap previously unrecoverable reservoirs.
"If you've been out to western North Dakota, you don't need a USGS report to know that there's oil there because you can see from all the drilling activity that there's a lot of energy development going on in western North Dakota," Dorgan spokesman Justin Kitch told Cybercast News Service .
Kitch admits that comparing Price's 1999 study to the April USGS study is like comparing "apples and oranges."
"But certainly it's nice to have an up-to-date assessment of the amount of oil that's technically recoverable in the Bakken," he said.
In 2006, Marathon Oil bought 200,000 acres in the Bakken to drill over 300 wells. This past May, after the report was released, Texas-based XTO Energy bought 352,000 net acres in the Bakken Shale for $1.9 billion.
The federal government, meanwhile, said only a small proportion of the oil available with today's technology is economically viable for recovery.
"If you're drilling the Bakken, it's pretty easy to drill somewhere in there and at least see some oil, but the question is: Is there enough there to get out and actually be economically recoverable?" Kolak asked.
At the end of 2007, about 105 million barrels of oil had been produced from the Bakken Formation.
The USGS, meanwhile, considers any release or dissemination of Price's unpublished report to be "inappropriate and irresponsible."
Thanks. Still, 20-40 is nothing to sneeze at. :-))
” and the manipulators will flee causing the oil bubble to explode!”
People are paying the current prices for every drop of oil they can buy, why would anyone sell it for less? There is no “speculator bubble” — consumers are setting the price.
Check out NOG, they are developing in these fields and their stock has gone banana’s. Made a small fortune for us. Oil or no oil..money is money.
Buy KOG now!!!
And remember, Soros is the kind of guy who giggles when he destroys a national economy.
Nope. Prudhoe Bay is about 20 BBO. The largest field in the continental US is the East Texas Field and it is 5 BBO. The good thing is that this will open up other non-conventional oil plays around the country as most to date have been gas plays. Horizontal drilling is not new in these types of plays for gas but it is for oil. If you could find the next one, you would be rewarded royally.
Are these USGS employees in the union and who does their union back in this election?
Two thousand a foot is very cheap to drill an oil or gas well. But if you can find a drilling company, casing crew, mud company, mud logger, chemical engineer, geologist etc to drill that well for 2k a foot, I wish you well.
It is clear that you don't understand basic economics. Increased supply decreases price. That is what this whole debate is about. Every expert has said the price is going up because supply is not high enough to meet demand. Increasing supply will bring the price down.
We really need to open up ANWR and the Shelf, too. It seems that high gas prices are finally having an effect on people to see the wrongheadedness of refusing to drill for what we know is there.
Exactly correct, the escalation in energy did not take off till just after the Bear Stearns bailout.
Strange coincidence or cause...?
IMVHO - It's a tax on all of us, without calling it a tax or anyone voting on it. Politicians hate to leave fingerprints.
I've read some estimates that it could be as much as 60% speculation. The problem is that they are supposed to be regulated. There is an agency that is supposed to ensure that speculation doesn't drive prices out of whack with supply/demand. But instead the gubmint has created giant offshore loopholes so that speculators can make money they legally aren't supposed to make, at our expense.
The government is happy to let them do this as high gas prices are a small price to pay to keep these institutions afloat considering what would happen nationally and globally if a bunch of them keeled over.
Hmmm. Maybe they are motivated by trying to help the country. But I doubt it. I think they're helping their big fat cat donors, while at the same time getting more tax revenues thru the higher gas prices.
And further, the high gas prices serve as an excellent political football that serves both parties. The GOP gets to posture some more about drilling for oil, the DEMs get to posture about evil oil companies and alternative energy, while both parties get rich doing nothing.
4 billion is still 1 years worth of US oil,
or $400 billion or more at current prices.
Drill it and enjoy.
You are correct.
It’s also correct that we are far better off giving that $100/barrel to a farmer in South Dakota and keeping our money in the USA than to Hugo Chavez or Saudi or Iranian mullahs.
“The USGS survey took 21 years to complete. The original lead author passed away before it was finished, he and his successor knew/know more than any other person in the world about this field. It is a rock solid analysis according to the oil commodities and equities speculation forums that I frequent. ANYONE who says otherwise at this point is to be assumed to be guilty of being a scam artist unless they can prove otherwise...”
Thanks for the confirmation. A 4 billion barrel field is no slouch. There’s no sense in overhyping it based on an outdated and incomplete study.
If you want a trillion barrels, just posey over to the Gree River oil shale formation in CO.
Imagine what creativity and innovation would be unleashed if the government nationalized the oil industry and put a bunch of civil servants to work on finding and producing more oil! /sarcasm
The estimates usually are conservative.
We are the only country that is doing nothing to increase our independance on foreign energy.
I watched Glenn Beck a few weeks ago and he was saying pretty much the same thing.
Iran for instance is building 7 new oil refineries that will be online by 2012.
China has a brand new hydroelectric dam.
China is also starting up a new coal fired powerplant every week or two, and at one point last year it was every 3 days.
The europeans are building 40 new coal fired power plants, not to mention the new nuclear plants that are springing up.
Yet we are hamstrung by the environazi’s and their democrat lapdogs as well as the NIMBY’s.
All 8000 pages of the Yucca Mountain site application was submitted last month along with 100,000 pages of back up document, and a further 30 million pages of additional back up documents, it’s going to take 90 days for the NRC to decide if they want to review it, then at least 3 years for the government to “review” it, and if approved it’s going to take 4 to 7 years to construct all the while the environazi’s and NIMBY’s will be filing lawsuit after lawsuit to stop it.
Here is my six points to energy independance:
First order of business should be to pidgeon hole all the environut groups and start hamstinging their actions.
Second, reverse congressional restrictions and all of the executive orders signed by clinton pertaining to energy matters.
Third, fast track new refineries as well as expansion of existing ones.
Fourth, fast track drilling off the coasts, in ANWR, and other areas.
Fifth, fast track development of new coal to oil, and shale recovery technologies.
Sixth, fast track building new power generation facilities (wind, water, nuclear, gas, geo-thermal, and coal).
Granted it will be a few years before it comes online, but it'll need plenty of feedstock.
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