- One survey was of the Bakken pool.
- The other survey was of the non-Bakken pool.
- The Bakken survey, 2008: 3 to 4.3 billion barrels of recoverable oil
- The non-Bakken survey, 2008: 200 million barrels of recoverable oil
The USGS in its 1995 survey estimated there was 150 million bbls of recoverable oil in the Williston Basin (I am not sure if that included or did not include the Bakken pool; that was before the 2000-Bakken boom that began in Elm Coulee, Montana).
Regardless, thirteen (13) years later, in the 2008 USGS survey of the non-Bakken formations in the Williston basin, the USGS estimated there were 200 million bbls of recoverable oil in non-Bakken Williston oil basin.
The estimates between 1995 and 2008 were not all that different -- they were certainly within the same ballpark as estimates go in the oil industry. It's hard to believe that after thirteen years of new technology (particularly hydraulic fracking) and thirteen years of new data (core samples, seismic data), the estimates between 1995 and 2008 were so similar.
The recent excitement in the Tyler formation alone suggests a new survey is needed. But before the survey is accomplished, let's see a few new Tyler wells with new technology. That might help the USGS surveyors. Also, maybe we should wait to see what the Canadian drillers can do with the Bottineau County Spearfish wells.
08 usgs survey did not assess the tfs.
ReplyDeleteMethodology applied to the 08 assessment required looking at past experience throughout the basin to obtain basin wide assessment and usgs said that insufficient tfs historical drilling/prod info was available to apply the methodology to tfs. I believe some operators who are active in tfs (clr, eog) have commented on their initial localized tfs experience but nothing that would provide a basis for a basin wide projection.
Not sure what purpose of the senators request would be if as I suspect, insufficient new data are available to produce a sound, meaningful projection.
Oil cos wouldnt seem to need usgs to help with tfs info at this stage. They are all over it.
We are in agreement with regard to the timing of the survey. I mentioned that in the last paragraph: we should wait until we have a big more data from the other formations.
ReplyDeleteWith regard to the oil companies being "all over it." That's part of the problem. Oil companies hold that information very close. If it turns out there is 2 billion more barrels rather than 200 million barrels (in the other formations) all of a sudden lease rates go up. Oil companies are caught in the middle: on the one hand they need folks to invest to pay for their CAPEX, but if they say too much how good the formations really are, the lease rates go up.
There is also the issue of credibility. CLR estimates 24 billion recoverable barrels in the Bakken pool vs the USGS estimate of 4 billion recoverable barrels. Which do you believe? The truth is probably somewhere in between.
Legislators need unbiased data to form policy.
Companies that want to invest in the infrastructure in the Williston Basin will make better decisions based on better data.
In the April dockets, some operators are asking to put 13 wells in one spacing unit. We are told that a Bakken well has an EUR of 750,000 bbls. Back of the envelope suggests that operators are getting very, very good deals when they acquire acres for $1,000/acre in some places vs $9,000/acre in other places.
Lots of reasons for a USGS study.
But you are correct: the timing is not quite right yet.
Companies are not sitting in their chairs waiting for another government study.
ReplyDeleteAnd a study would not give private mineral owners any useful info. Individuals just don't own large enough parcels or have access to the geo details that the company is targeting.
The 08 study was based on publically available info and other studies (Dr Price for example) had predicted existence of large amounts of new reserves.
The oil cos knew all of this. The wild card then as now is the sustainable price of crude not some government study .
And when did you get to be for gobment intervention in private contracts? This seems out of character
The same government you are relying on for oil assessment runs the EPA so why do you expect better performance ???