[ckilmer]

What EOG sees -- and the market doesn't seem to grasp -- is that for all intents and purposes, the horizontal oil boom is coming from only two plays: the Bakken Formation in the upper Midwest and the Eagle Ford Shale in South Texas. A slide from EOG's most recent investor presentation illustrates this clearly:

Fully three-quarters of the horizontal oil being produced in the United States comes from the Bakken and Eagle Ford. Without these plays, the horizontal boom would be barely noticeable.

Equally important to note is that production growth in both the Bakken and the Eagle Ford is slowing significantly. The growth of production both by rate and absolute amount in both of these plays appears to have peaked.

During his recent presentation, EOG's Thomas was asked what the next big horizontal oil play in the United States would be. His answer? There isn't going to be one.

EOG has scoured the United States and hasn't found a new play with anything close to the productive capability of the Bakken and Eagle Ford.

What makes the Bakken and Eagle Ford unique is that they are crude oil plays. Most of the other large horizontal plays are "combo" plays that have large hydrocarbon accumulations, but much of those hydrocarbons are in the form of natural gas and natural gas liquids.

For example, in his presentation, Thomas referred to the Permian Basin in West Texas as having lots of barrels of oil equivalent (BOEs) -- but heavy on the "equivalent" and light on the oil. There is going to be a lot of production from the Permian in the coming years, but a great deal of it won't be oil.

[ckilmer]

I think the plateau at the end of the graph will go sharply higher when summer reports come out.

EOG’s take on the Permian is telling. That explains why they’re doing a massive amount of new drilling in the Eagle Ford right now. This means that at least EOG’s leases in the Permian are don’t have a lot of oil but rather a lot of natural gas and NGL’s.

Should EOG’s word that there won’t be anymore eagle ford or bakkens in the USA — be taken as gospel? Or just a very educated opinion right at this moment.

[A Formerly Proud Canadian]

If you look closely at the chart you posted, you will see that all the formations peaked in October 2013 or so. Chances are, this was a decision from board rooms, rather than a natural slowing of production.

Perhaps the more important measure would be recoverable oil reserves. From an Alberta perspective, the recoverable reserves in the Athabasca oil sands grows each year as new technology pushes that figure upwards. In addition, some of the older plays are extended by enhanced recovery methods like SAGD, CO2 injection (Weyburn Field), etc.

Because of where EOG came from (Enron Oil and Gas), and having met the former President of EOG Canada in 2000, I take anything said by the ‘brass’ at EOG with more than a grain of salt. The moment I heard that man speak in 2000, I took a distinct dislike to him. Arrogant, hyperactive blarney, with little substance, cut from the same cloth as Skilling. First impressions are lasting!

[crusty old prospector]

PXD. That’s your big player in the Midland Basin. The Delaware has many playas. They all need more water and sand.

[bestintxas]

Go back to previous postings I have made here.

The Bakken is unique, and the Eagleford has only a relatively tiny window of commercial activity along its liquids maturity belt.

No one has found the widespread commercial accumulation as these two have.

Chances are no one will.

Physics dictates liquids does not move very well through such tite rock