Saturday, December 8, 2012

How Big Is The Bakken?


December 30, 2017: update here.

Original Post

This is a "cut and paste" from the blog, but it is too important to be lost where I first posted it, so it is posted again.

I've often said that the Bakken is now the "gold standard" for oil companies. This lede caught me by surprise:
Can Roseneft and Exxon Mobil help make Siberia more like ... North Dakota?
I kid you not. Page B16, WSJ, "Heard on the Street."  The article goes on:
When the Kremlin's oil champion and Big Oil's biggest sealed a strategic alliance in 2011, tight oil was little more than a footnote to ambitions in the Russian Arctic. But Friday's announcement of a deal to explore the enormous Bazhenov deposit makes Western Siberia suddenly much more important.
Like the Bakken shale under North Dakota, the Bazhenov is thought to contain vast oil reserves trapped in tight rock formations. At 570 million acres, its land mass is the size of Texas and the Gulf of Mexico combined, according to Sanford. C. Bernstein. Bazhenov could hold between 60 billion and 140 billion barrels of oil, and production could approach one million barrels a day, or around 10% of Russia's total, by 2020, analysts say. Commercial production in the Arctic will only just be getting started by then. [For newbies: the Bakken, much, much smaller, could hold 500 billion bbls of oil; without political interference the Bakken will easily hit one million bbls of oil per day; and that is about 12% of current US domestic production. Just putting things into perspective.]
But Bazhenov represents a grand experiment. America's tight oil boom was pioneered by small, innovative companies, aided by individual mineral rights and an array of oil services and infrastructure resources. While big boys like Rosneft and Exxon should enjoy the might of the Kremlin's backing—including hoped-for tax breaks—they are very different pioneers operating in a very different environment.
One wonders if the Bakken would have gotten more respect had XOM discovered, developed, and marketed it?

The Bazhenov overs 570 million acres, its land mass the size of Texas and the Gulf of Mexico combined; the Bakken (on the US side of the border), officially seventeen counties in North Dakota and three counties in Montana, but for all practical purposes about seven counties in North Dakota and, maybe, two counties in Montana. Although the Bakken is officially 128 million acres (wiki) for all practical purposes it is much less. And here we have a Siberian story suggesting that 570 million acres might produce on a daily basis what the Bakken is already nearly producing.

The Bazhenov is linked at the sidebar at the right under "other formations."

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