And this can do the same thing:
... if we give it a billion dollar subsidy or something...
Posted on 07/02/2013 4:22:49 AM PDT by thackney
Continental Resources, the Williston Basin’s largest producer and one of the region’s most active and experienced explorers, has all but officially declared a significant increase in the amount of oil it believes can be recovered from the massive Bakken petroleum system.
Its estimate today stands at 24 billion barrels of oil equivalent, already far exceeding the federal government’s official estimate, which it recently doubled.
Continental’s recoverable calculation for the U.S. portion of the Bakken is based on a dated oil in-place estimate of 577 billion boe. Last year the company raised that in-place estimate to 903 billion boe without increasing the recovery estimate, leaving others to speculate based on whatever recovery rate they chose to apply.
Continental has indicated that any change it makes to the current 24-billion boe recovery estimate likely would not come until at least the end of 2013, after it completes extensive productivity testing of the lower benches of the Three Forks formation. But the more successful these test results become, the bolder the company seems to get with its observations.
“As much as you’ve been hearing, and as large as this play is with 24 billion boe recoverable, we believe at this time that’s a somewhat faded estimate,” Warren Henry, Continental’s vice president of investor relations, conceded during his presentation to the Global Hunter Securities GHS 100 Energy Conference June 25 in Chicago, Ill.
Some areas 32-40 wells a unit
In spite of all the drilling Continental and others have conducted in the Bakken over the past several years, “this play is still very, very young in its development,” he said, noting that on average there is still less than one well per 1,280-acre spacing unit across the 15,000- square-mile play. Henry explained:
“So, depending on how you look at the spacing and how you look at the different benches, we believe there is going to be anywhere from 16 to 20 wells at minimum per spacing unit and, in some areas, we think this is going to be 32 to 40 wells per unit.”
Given the fact that Continental already has boosted its in-place estimate a whopping 57 percent to the 903 billion-boe mark, increasing the amount of resource that can be recovered from this base seems inevitable. The bigger the pie, the more there should be to eat.
Continental published its original 24 billion boe recoverable estimate on 577 billion boe of in-place oil in October 2010, based on work it did in the Middle Bakken and in the upper part of the Three Forks. All this was based on 320-acre well spacing.
In 2011 and 2012, the company further conducted a well-coring program and was in the process of developing “a whole earth model” with some of its vendors, “thinking that we would core through the oil saturation and find where it ended,” Henry recalled.
“What we found was it didn’t end,” he added. “It went all the way down to the Nisku (bottom cap). So based on the coring and the work we’ve done since then, we now believe there’s 903 billion boe.”
Possible to double recoverable oil
The Oklahoma-based company’s reluctance to establish an updated oil recovery estimate on the 903 billion boe of in-place resource has not kept it from publicly talking about possibilities, even working out numbers in advance for the curious, as it did at last week’s Global Hunter Securities energy conference.
Henry noted that a 3.5 percent recovery rate on 903 billion barrels of in-place oil would “pump” the 24 billion barrels up to 32 billion barrels.
“If we were able to increase the recoveries with technology, it could be four or five percent (and) could double the recoverable oil,” he said.
He said “the key catalyst” for Continental right now is the on-going well productivity and density tests, which will carry into next year and help establish just how much resource can be recovered from the Bakken petroleum system.
However, Henry said “probably the most important catalyst” for the company during the past several months in the Bakken has been the company’s continuing move to pad drilling.
“And to the extent that we were originally four wells per pad and now we’re doing up to 12, this has really taken off,” he said. “And you can see here in terms of the times that we have eliminated between single wells and pad wells. We eliminated $7.5 million in costs for six wells in 73 days, with this pad drilling on the project.”
Meanwhile, Continental has spent a lot of time “educating refineries” on the East Coast, West Coast and Gulf Coast about the high quality of Bakken oil, Henry said, pointing out the low sulfur content of the oil and the fact its quality is consistent across the Williston Basin.
“So what you have now are these markets that have been created … for oil which is reaching primarily by rail,” Henry said. “This is very important because the rate of growth of production in the Bakken is growing. They are continuing to build offloading facilities on all three coasts for Bakken oil.”
... if we give it a billion dollar subsidy or something...
Don’t they know the president has declared oil “the fuel of the past?”
Yep, the past...
and the present...
and the future!
Would be nice to have the Keystone Pipeline to move the product, instead of Warren Buffet’s railroad. It is in the same neighborhood, after all.
And it also slices, dices and make julienne birds and raptors that can be blamed on the Conservatives!
All you need to do is build a gas power plant for each of these bird cuisenarts for when the wind is too slow, or too fast...
I’ve got a new game for the grandkids riding with me.
I let ‘em practice counting the number of those damn bird killers that are actually turning out of the dozens we see in drives around Montana, Wyoming and Colorado.
The 3yo gets that job, since she’s only reliable up to her age right now. The older kids count ALL of ‘em, the 11yo has been working out percentages and the high school cutie...well, she’s had to be told to stop talking back to her “Science” teacher after all these Engineering Evaluation sessions during Rides with Gramps.
Guess I’m just a bad influence.
Algorobama is deeply saddened.
-——Algorobama is deeply saddened.-——
Saddened or prescient?
I think he knew of the coming surge and scored political points by savaging the efforts in the Gulf. He knew or suspected he would be vindicated by the emerging story of oil dispalcing the Gulf deepwell efforts. Silence was his weapon
Too bad we can’t build more refineries in the upper mid-west.
The lesson could be expanded a bit, probably something you’ve already thought of.
“If 3 of these towers kill x number of birds per day, how many would 300 of these towers kill each year?”
For the more advanced: “If .01% of the birds killed were birds protected by the EPA, how many protected birds were killed last year on that wind farm we just drove through?”
Trick question for the brainiac: “ if the typical fine for killing a protected bird is $15,000 (I’m not sure what it actually is) how large was wind farms fine last year?”
Answer “$0, the EPA protects the windmill farms from anyone counting how many protected birds are killed, thus protected birds are being killed by protected windmills.”
Extra credit question:” define ‘protected’ as it pertains to birds, and to windmills, expounding on the various meanings of the word.
Known Bakken oil reserves is not something new.
“...........History of Bakken Oil Generation Estimates
A landmark paper by Dow and a companion paper by Williams (1974) recognized the Bakken as
a tremendous source for the oil produced in the Williston Basin. These papers suggested that the
Bakken was capable of generating 10 billion barrels of oil (BBbls). Webster (1982, 1984) as part
of a Master’s Thesis at the University of North Dakota further sampled and analyzed the Bakken
and calculated hydrocarbon generation capacities to be about 92 BBbls. This data was updated
by Schmoker and Hester (1983) who estimated that the Bakken was capable of generating 132
BBbls of oil in North Dakota and Montana. Price (unpublished) used a more complete database
and estimated that the Bakken was capable of generating between 271 and 503 BBbls of oil with
an average of 413 BBbls. New estimates of the amount of hydrocarbons generated by the Bakken
were presented by Meissner and Banks (2000) and by Flannery and Kraus (2006). The first of
these papers tested a newly developed computer model with existing Bakken data to estimate
generated oil of 32 BBbls. The second paper used a more sophisticated computer program with
extensive data input supplied by the ND Geological Survey and Oil and Gas Division. Early
numbers generated from this information placed the value at 200 BBbls later revised to 300
BBbls when the paper was presented in 2006.........”
by Julie LeFever and Lynn Helms
Uhm, no they don't. It is mostly private land. That is why they have been drilling it extensively for years. They have made North Dakota the 2nd largest oil producing state (after Texas).
Known Bakken oil reserves is not something new.
No, but the combined technology of hydraulic fracturing with steerable horizontal drilling and 3D seismic to track the lateral placement is relatively new. Until this century, it wasn't economic to produce these tight formations. Hydraulic Fracturing began back in 1947, but without the other two, it was not economic enough to attract the investment we have seen over the last decade.
I wonder how much each well flows on the average, you would have to have a huge tank battery on site and massive trucking if no pipeline available. I know our company CenterPoint Field Services signed a deal with XTO or Exxon to build a lot of infrastructure and pipe the oil to a certain facility and it will leave there and go to a rail loading facility. I have heard anywhere from 1000BBL per day to 600BBL per day
Pretty good production drop
Very steep drop. It is a function of the low permeability of the play, which is why they did the horizontal laterals and multi-stage hydraulic fracturing.
I’ve heard some say “horizontal wells have vertical declines”.
It is the reason that a drop in price, and a drop in drilling, won’t take too long to see significant reductions in total production.
I’m reading that the baaken costs come in at about $80@ barrel. With several new technologies including ones that harvest the natural gas for fuel and multiple drills per platform—they may be able to shave $20@ barrel off that in the next year or two. I don’t really know for sure.
You also have to figure that if the recoverable oil in the Baaken keeps growing—then what’s available in the Permian basin...is really off the scales—since its so much bigger and deeper. The permian basin oil may wind up being cheaper too — once the pipelines are put in.
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