It is proving very difficult to find another Bakken.
Especially difficult when the Fed gov puts most workable land under lock and key.
One other thing to ponder is that this administration politicizes everything. Maybe Warren Buffet is getting ready to go into oil production and needs the prices on leases and companies to go down a little bit more?
I don’t agree with this. But some interesting assertions/graphs.
The problem with the guy’s assertion is that in place reserves the Baaken (and Three Forks)are about 500 billion barrels of oil. Addressable reserves—that is oil that can extracted—is only a small fraction of that. A couple years ago that number was only about 3.5 billion barrels. However, because of improvements in technology—the size of addressable reserves keeps rising.
This article cites Goldman Sach and Credit Credit Suisse who both sent analysts out to the Baaken. Here’s what it says:
“A massive, 76-page report from Goldman Sachs from late September suggests 2023—that’s another TEN YEARS of growth—with the biggest growth year being next year, in 2014.
In fact, they say the worst case scenario for the Bakken is now 1.3 million in 2017. One million? Pfffftttt…yesterday’s news.
A smaller examination from Credit Suisse in early October suggests the same thing. Analysts from these investment giants went to the Bakken to find out firsthand whether this prime play has peaked.
And the two groups independently returned with the same answer: no.”
http://oilandgas-investments.com/2013/energy-services/bakken-oil-three-forks-formation/
..............
What’s happening in the Baaken is happening in spades in the Permian Basin
Recently raised estimates for Permian basin place its addressable reserves as greater than the greatest oil field in the world the Ghawar field in saudi arabia.
http://www.fool.com/investing/general/2014/05/24/the-amount-of-oil-in-this-american-oil-patch-is-go.aspx
I want to see charts like that for the Permian Basin.
It’s proving very difficult to face reality it seems to me
The key in unconventional oil like the Bakken is economic extraction over a widespread area.
It is proving very difficult to find another Bakken.
..............
are you also arguing that you’ve seen the geology in the permian basin and its convinced you that despite recent reports that the Permian basin has more addressable oil than the the world’s largest oil field —the Saudi Gwadar oil field—that this oil is NOT addressable. Or at the very least you can’t get the same kind of economies of scale in the Permian basin that you can in the bakken—because the oil is so spread out.
http://www.fool.com/investing/general/2014/05/24/the-amount-of-oil-in-this-american-oil-patch-is-go.aspx
Therefor we will not see the sort of parabolic rise in oil production in the Permian basin that we’re seeing in the Bakken. That further the bakken oil production rises will continue to be parabolic past the end of 2015.
To be fair here Pioneer Natural Resources is not suggesting that there is anything like +200 billion in addressable oil in the Permian basin. Rather their numbers are in the 75 billion barrel range of addressable oil. This might seem plausible to many because there are so many more pay zones stacked on each other in the permian basin than in the eagle ford or the bakken.
anyhow, what say ye?
bkmk