New Report Details Bakken Shale Oil
By JAMES MACPHERSON
BISMARCK, N.D. — The 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 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 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 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.
Oilmen have known for more than 50 years that the Bakken holds vast oil reserves, Kessel said, but economics were an issue.
According to Jim Ehrets, a Denver-based geologist with Headington Oil Co., of Dallas, it costs about $5 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.
Originally published by JAMES MACPHERSON Associated Press.
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