North Dakota Oil Bonanza!

[John L]

I don't know if anyone has been watching Fox Business Channel, but they are treating this North Dakoda oil field drilling like it is a football game. It's exciting to watch what is happening with this huge find, and Fox is playing it for what it is worth.

Just to give you an idea as to how HOT the N Dakota oil rush is going, look at the April drilling permits. You can look back at the other months by going to the top of the page and hitting each month. The number of permits are HUGE!. There's a real oil rush going on there! Even if only 10% pan out, there is going to be more oil than you can imagine.

Massive Oil Deposit Could Increase US reserves by 10x



America is sitting on top of a super massive 200 billion barrel Oil Field that could potentially make America Energy Independent and until now has largely gone unnoticed. Thanks to new technology the Bakken Formation in North Dakota could boost America’s Oil reserves by an incredible 10 times, giving western economies the trump card against OPEC’s short squeeze on oil supply and making Iranian and Venezuelan threats of disrupted supply irrelevant.

In the next 30 days the USGS (U.S. Geological Survey) will release a new report giving an accurate resource assessment of the Bakken Oil Formation that covers North Dakota and portions of South Dakota and Montana. With new horizontal drilling technology it is believed that from 175 to 500 billion barrels of recoverable oil are held in this 200,000 square mile reserve that was initially discovered in 1951. The USGS did an initial study back in 1999 that estimated 400 billion recoverable barrels were present but with prices bottoming out at $10 a barrel back then the report was dismissed because of the higher cost of horizontal drilling techniques that would be needed, estimated at $20-$40 a barrel.

It was not until 2007, when EOG Resources of Texas started a frenzy when they drilled a single well in Parshal N.D. that is expected to yield 700,000 barrels of oil that real excitement and money started to flow in North Dakota. Marathon Oil is investing $1.5 billion and drilling 300 new wells in what is expected to be one of the greatest booms in Oil discovery since Oil was discovered in Saudi Arabia in 1938.

The US imported about 14 million barrels of Oil per day in 2007 , which means US consumers sent about $340 Billion Dollars over seas building palaces in Dubai and propping up unfriendly regimes around the World, if 200 billion barrels of oil at $90 a barrel are recovered in the high plains the added wealth to the US economy would be $18 Trillion Dollars which would go a long way in stabilizing the US trade deficit and could cut the cost of oil in half in the long run.

And here is more of the same.

The Bakken Oil Field
The Oil Find That Trumps Saudi's Biggest Oil Field



By Ian Cooper
Tuesday, April 8th, 2008

Comfortable with $100+ oil prices, OPEC oil exporters refused to increase output, a move that quickly sent oil above $108 a barrel.

"At the moment there is enough oil in the market and no need to change OPEC's output," said OPEC general secretary Abdullah al-Badri, opting to blame the "US economic recession, lack of refining capacity and depreciation of the dollar's value" for higher oil prices.

While true, what if the U.S. could tell OPEC oil exports where they could stick their oil? What if we could significantly reduce our dependency on foreign oil, and sit back as the Middle East lost billions in oil revenue?

Well... if all goes according to plan, we may be able to do just that.

The Next Oil Boom Is Upon Us... in the Bakken Oil Field

U.S. consumers paid out $340 billion to import 14 million barrels a day... just for 2007. And it's only likely to get worse. We're already paying more $3.30 for a gallon of gas on gushing pre-summer driving season oil prices.

Sure, U.S. oil production has been spiraling downward for the last 40 years. But there's one area that's just starting to heat up, one that could boost our oil reserves 10 times over.

We're talking about the opportunity to meet all U.S. oil needs for the next two decades. That's huge.

Think about that. What if we could reduce our dependency on foreign oil? The Middle East would lose its marbles.

Locals call it "The Bakken." It's a behemoth oil reserve stretching across North Dakota, Montana and southeastern Saskatchewan... a reserve so massive it contains 10 times more barrels of oil than Alaska's North Slope. It's something my colleague Keith Kohl has been telling you about for months in his Bakken Oil Formation report.

While the U.S. Geological Survey has reported the Bakken field could hold more than 400 billion barrels of recoverable oil, a new report offering an accurate assessment of the Bakken Formation will be released over the next 30 days, finishing the work started by scientist Leigh Price.

Price had estimated that the Bakken field held as many as 900 billion barrels of oil, but died before the work could be published or reviewed. Some pegged it at close to 200 billion to 300 billion, with others calling for more than 400 billion.

Until recent years, the technology simply wasn't available to economically extract the oil from the Bakken shales, making product efforts overwhelming. But with breakthrough techniques such as horizontal drilling, the full potential of the Bakken play can now be developed. And it's well worth it given high oil prices and technological advancements.

Bakken's Black Gold... Right Here in America

Thar's black gold in them thar hills... This time in North Dakota. And as we mentioned above, the discovery could be significant. Unlike Northern Canada's oil sands, the Bakken's oil can be extracted relatively cheap, without the use of energy intensive processes.

That news alone means North Dakota could be headed for a boom oil year.

In January 2008 alone, the North Dakota Oil and Gas Division issued 90 permits to drill. At that pace, the number of permits could double those of last year, and "be near the record 1,098 issued in 1981," according to reports.

Truth told, with oil prices likely to remain well above $100, these are exciting times. The time for oil sticker shock is over.

[bkkandrew]

The lower link is essentially an advert for investors...

Any oil boys here want to comment?

[barbaro]

John....

It's mostly in shale.

It's be a while.

And....it won't affect peak oil.

There is already a thread on this topic in the "crude oil" thread here.



Cheers.

[Hootad Binky]

the new assessment estimates 3.65 billion barrels of undiscovered technically recoverable oil

Not "200 billion."

Further:

With only vertical drilling, most of the oil in the Bakken was unrecoverable. The development of horizontal drilling prompted a new study of the Bakken Formation conducted by Price. Price’s estimates ranged from 271 to 503 billion barrels of technically recoverable oil at the time of his death. However, due to Price’s death and the low price of oil in 2000, $10 a barrel, the study never received a scientific peer review. The USGS assessment released Thursday is the only official USGS study since 1995. Even with the USGS stamp on the Bakken as the largest oil accumulation in the lower 48 states, Tim Lechner, senior operations engineer for Headington Oil, has his reservations. “I think they have overstated their reserve potentials,” Lechner said. “They are assuming that every square mile will produce as good as the best well. That has not been and never will be the case.”

Rich Pollastro, a geologist for the USGS who worked on the Bakken assessment, said, “Our assessment is of ‘undiscovered, technically recoverable resources,’ not economically recoverable resources. It will take tens of thousands of wells with ‘success’ and ‘failure’ to produce the resource we have estimated.”

Technically recoverable resources are those which can be recovered using today’s technology if cost were not a consideration. Whereas, economically recoverable resources is what resources can be recovered without financial loss to oil companies taking into account the price of oil and the cost of drilling and maintaining wells. A horizontal well can cost anywhere from 25 to 300 percent more to drill and complete than a vertical well with the same target. Current estimates for the cost to drill and complete a horizontal are between $4 million to $5 million.

"Technically" and "economically" recoverable are not the same thing

Bakken's oil can be extracted relatively cheap

That is false. Moreover, a third of the field is in Canada!

Sidney Herald - We are your story!: Research says more oil in area

[John L]

Binky, that is the OLD forecast, that has been around since the 50s. That has changed. New technology is making it more than possible to recover the oil.

Further, IF drilling goes deeper and finds more oil not locked up in shale, this will destroy forever the theory of "fossil" oil, because the oil will be coming up from the mantle.

[sabang]

I'm not an oil man, but I am an ex-stockbroker that was very much involved in several mining booms (and busts). This is obviously an oil boom.

You can bet there are several speculative oil plays being hyped by mining promoters ( read snake oil salesmen) as we speak. You can bet plenty of people will lose money as a result. High oil prices, if sustained, obviously make previously uneconomical deposits economical. Technology advances also- although frankly I have seen no hard evidence of technology advances with respect to shale oil extraction. Horizontal drilling is nothing new.

Just to give some historical perspective, most of the recent hype is not new. Vast shale oil deposits have been known about for some time in the US and Canada- they just weren't considered commercially viable. The recently hyped oil deposits off Rio also- they are deep water deposits in rough seas, therefore not commercially exploitable until recently. Ditto the vast deposits under the Siberian tundra- they may in fact be the worlds largest reserve. Ditto the rumoured vast deep water deposits in the south Atlantic. Something tells me they will be hyped soon as well, if they are not already being hyped somewhere.

[sabang]

Further, IF drilling goes deeper and finds more oil not locked up in shale, this will destroy forever the theory of "fossil" oil, because the oil will be coming up from the mantle.

I wonder about this myself. Do you have any links to viable alternative theories for the existence of large deposits of 'Fossil Fuel' John? When you add coal, oil, natural gas and even peat together, that does seem an awfully large amount of dead organisms!

[John L]

Further, IF drilling goes deeper and finds more oil not locked up in shale, this will destroy forever the theory of "fossil" oil, because the oil will be coming up from the mantle.

I wonder about this myself. Do you have any links to viable alternative theories for the existence of large deposits of 'Fossil Fuel' John? When you add coal, oil, natural gas and even peat together, that does seem an awfully large amount of dead organisms!

Here is a great link, Abiotic Oil. Lots of other links.

Inorganic origin of oil: Much ado about nothing?

More Evidence For Sustainable Oil

Feuding Over the Origins of Fossil Fuels

There is just too much hydro-carbon around for it to be 'fossil' in origin. Coal? I will go along with that. Peat? That too. But all that oil and natural gas, including all the Methane Hydrates, no way it is biotic in nature. There's just too much of it. And if it isn't, it has to come from only one place; the hot mantle.

Shale is a porous rock, and it would naturally absorb liquid hydro-carbon. And if it came from a hot origin, it would be seeping UP and shale would gladly absorb it. And if that is the case, there has to be much more below it.

I find this theory of Peak Oil to be less than accurate.

[Begbie]

Feuding Over the Origins of Fossil Fuels

There is just too much hydro-carbon around for it to be 'fossil' in origin. Coal? I will go along with that. Peat? That too. But all that oil and natural gas, including all the Methane Hydrates, no way it is biotic in nature. There's just too much of it. And if it isn't, it has to come from only one place; the hot mantle.

Shale is a porous rock, and it would naturally absorb liquid hydro-carbon. And if it came from a hot origin, it would be seeping UP and shale would gladly absorb it. And if that is the case, there has to be much more below it.

I find this theory of Peak Oil to be less than accurate.

All nonsense and wishful thinking I'm afraid. Shale is porous but not permeable therefore not a pathway for the migration of liquid.

It's been demonstrated for a very long time that oil is the byproduct of the break down of organic material under pressure and heat. Beyond a certain pressure (depth) and temperature you get gas produced instead of oil.

There's been a theory kicking around that some gas (not oil) is produced from the mantle. Attempts to prove this by drilling deep wells in heavily fractured areas of ancient meteorite impact craters have given negative or at best inconclusive results.

[John L]

Feuding Over the Origins of Fossil Fuels

There is just too much hydro-carbon around for it to be 'fossil' in origin. Coal? I will go along with that. Peat? That too. But all that oil and natural gas, including all the Methane Hydrates, no way it is biotic in nature. There's just too much of it. And if it isn't, it has to come from only one place; the hot mantle.

Shale is a porous rock, and it would naturally absorb liquid hydro-carbon. And if it came from a hot origin, it would be seeping UP and shale would gladly absorb it. And if that is the case, there has to be much more below it.

I find this theory of Peak Oil to be less than accurate.

All nonsense and wishful thinking I'm afraid. Shale is porous but not permeable therefore not a pathway for the migration of liquid.

It's been demonstrated for a very long time that oil is the byproduct of the break down of organic material under pressure and heat. Beyond a certain pressure (depth) and temperature you get gas produced instead of oil.

There's been a theory kicking around that some gas (not oil) is produced from the mantle. Attempts to prove this by drilling deep wells in heavily fractured areas of ancient meteorite impact craters have given negative or at best inconclusive results.

I am more content to be satisfied with the abiotic oil theory. Granted it's fairly new in the West, but the Russians have been following this for decades and they are now the second largest oil producer. I well remember that there have been many theories that were shrugged off. Theories such as the thought that North and South America were once part of Europe and Africa. Or how about the theory that all those lunar craters were not caused by vulcanism, but impactors. I remember what Eugine Shoemaker had to go through before he was proven correct.

Again, there is just too much hydrocarbon present to be from fossils.

[Begbie]

Again, there is just too much hydrocarbon present to be from fossils.

Based upon what studies ?

A good analysis debunking the concept aboitic hydrocarbons is found here.

http://static.scribd.com/docs/j79lhbgbjbqrb.pdf

[John L]

Again, there is just too much hydrocarbon present to be from fossils.

Based upon what studies ?

A good analysis debunking the concept aboitic hydrocarbons is found here.

http://static.scribd.com/docs/j79lhbgbjbqrb.pdf

In all honesty, I speed read through most of the article, but then concentrated on the opening remarks and summary. What i gleemed from it is that to the writer, who is a chemist, that there are still issues with the theory. I'll give you a couple of examples.

However, it now appears that the great
oil fields of the Volga-Urals region, the northern Urals
and western Siberia were discovered not as a result of
application of this theory as its proponents claim but by
the use of conventional exploration methods which gave
“the final word to the borehole”.

this reaction is not thermodynamically
favourable under these conditions and can not be facilitated
by the presence of bacteria.

From his lack of conclusions, he states that

This theory is therefore invalid.

I think he used a poor choice of words, in that because he found no positive evidence, he is not willing to even conceed the possibility.

However, he then concludes,

In conjunction with Japanese colleagues, we tested this theory in respect
to the formation of oil and gas deposits in the Niigata and
Akita basins in northern Honshu, Japan, with mixed
results (Glasby et al., 2004).

To my way of understanding English, "mixed results" means just that: "mixed results".

But keep in mind two things. First, due to the extreme difficulty of deep drilling, along with high costs, this has been a last resort thing, which is now beginning to be applied. Time will tell on this. And second, the presence of organic material does not make the presence of hydrocarbons organic in origin. The vast majority of organic/living organisms are lifeforms that thrive deep within the earth, and live in hot areas. It has been estimated that ifyou took all the Anaerobic organisms and stack them up against the aerobic ones(including humans) pound for pound, the anaeorobic organisms would greatly outweigh the later. With all that life deep in the earth, it is only natural that there would be a presence of life found within oil deposits, creating the impression that that very oil originated from living organisms.

But the fact is that this is still a theory, because it is new, and yet unprovable. But we shall find out in the near future as more deep drilling is done around the world. I don't really have any axe to grind with the "Peak Oil" Crowd, other than to say that I don't believe that we are anywhere near a 'peak' that has been talked about for years.

I'm just using common sense here. And my gut feeling is that there is entirely too much mass of hydro-carbons present to have been caused by living organisms, and even with geologic uplifting, too much deep inside the earth for the original theory to be entirely valid. Time will tell, won't it? I am thinking positive here.

[Johnny Longprong]

Oh ye of little faith!!

[Johnny Longprong]

^ Whoops! Embedding disabled. However, some of you older folk might get the connection.

[Begbie]

Yes I'd forgotten about the Beverley Hillbillies.

But the fact is that this is still a theory, because it is new, and yet unprovable. But we shall find out in the near future as more deep drilling is done around the world. I don't really have any axe to grind with the "Peak Oil" Crowd, other than to say that I don't believe that we are anywhere near a 'peak' that has been talked about for years.

Sorry John but a theory that states deep drilling will discover hydrocarbons coming from the mantle falls on it's face when the drilling found no such thing. Diplomatic choice of words in the document not withstanding.

The thing about oil, the higher the price the more it will be substituted by expensive alternatives. Therefore we're never going to run out of oil it will just be too expensive.

[stroller]

It would be nice to think that there is a limitless supply of oil, and the US is sitting on it, I suppose.

Fits well with the belief that burning fossil fuel has no impact on climate or the environment.

[qwerty]

Begbie, Sabang and Hootad have basically said all there is to be said on this subject. Yes, there is lots of unexploited oil around. Most of it is unexploited because of the high cost of getting out of the ground and to the customer. If oil prices stay high, this oil will end up on the market. If oil prices drop, the oil companies will drop these wells like hot potatoes - they're not in the business of losing money.

As for abiotic oil - it's a theory, but as yet unproven. Quite frankly, even if abiotic oil is real, it seems to be quite rare and won't affect the market at all.

[stroller]

It is an interesting theory, though, I wonder about those deep wells in Russia, how do they fit into the picture - maybe one of our oil guys can shed some light on this?

[bkkandrew]

Its a pity for all those hoping for oil to come from the Earth's core that the markets don't agree with you and instead post a new high price every day...

[barbaro]

Yes I'd forgotten about the Beverley Hillbillies.

But the fact is that this is still a theory, because it is new, and yet unprovable. But we shall find out in the near future as more deep drilling is done around the world. I don't really have any axe to grind with the "Peak Oil" Crowd, other than to say that I don't believe that we are anywhere near a 'peak' that has been talked about for years.

Sorry John but a theory that states deep drilling will discover hydrocarbons coming from the mantle falls on it's face when the drilling found no such thing. Diplomatic choice of words in the document not withstanding.

John is free to have his opinion, that we haven't reached the peak.

However....all we need to do is look at the production. The output.

How many MBPD (millions of barrels per day) is the entire world using: About 88 million barrels per day.

Demand has gone up. A lot of the increased demand is coming from Asia.

But output has not increased to meet this demand. This is not because OPEC is restricting supplies intentionally.

Other discoveries of oil reserves will not produce nearly enough needed.

Russia is not. The Canadian oil sands will not. Nigeria will not.

I think the peak happened in 2005.

[bkkandrew]

^I remember reading 2002 somewhere and agreeing with the rationale used. Can't remember the details though. Slept (and drunk) since then...

[John L]

I think the peak happened in 2005.

Remember, this was also stated in the 1970s as well. Yet further exploration revealed more, and the marked adjusted accordingly. I listened to an oil expert on the news, who stated that we go through this ever 25-27 years. We feel the pressure, adjust by finding more oil, and go through the process once more.

I think he is correct.

[Boon Mee]

I think the peak happened in 2005.

Remember, this was also stated in the 1970s as well. Yet further exploration revealed more, and the marked adjusted accordingly. I listened to an oil expert on the news, who stated that we go through this ever 25-27 years. We feel the pressure, adjust by finding more oil, and go through the process once more.

I think he is correct.

From what I know - which is a dern site more than some TEFLer's knowledge of the Oil Bidness...the gentleman referenced above, is correct.

[jizzybloke]

I think the peak happened in 2005.

Remember, this was also stated in the 1970s as well. Yet further exploration revealed more, and the marked adjusted accordingly. I listened to an oil expert on the news, who stated that we go through this ever 25-27 years. We feel the pressure, adjust by finding more oil, and go through the process once more.

I think he is correct.

How many times can this happen, nothing is infinate?

[John L]

I think the peak happened in 2005.

Remember, this was also stated in the 1970s as well. Yet further exploration revealed more, and the marked adjusted accordingly. I listened to an oil expert on the news, who stated that we go through this ever 25-27 years. We feel the pressure, adjust by finding more oil, and go through the process once more.

I think he is correct.

How many times can this happen, nothing is infinate?

I really can't give you an honest forecast there Jizzy, but I hightly suspect that in the near future, other less costly energy solutions will develop, and the market will normally handle the move by itself.

I think that eventually cell storage and solar collectors will have developed enough to force a cutting down on other hydrocarbons, such as coal. Also, look for later generation nuclear generators to become much more common. The life cycle has proven to be far longer than original planned too, so look for nuclear plants to have at least double the useful life than they used to be.

I mention nuclear fission because that is the ONLY practical way that hydrogen fuel technology will ever get off the ground. Otherwise there is more expended energy used to produce the equivelent amount of hydrogen energy. That just will not work from an economic standpoint.