Some Idle Back-Of-The-Envelope Calculations; Some Idle Rambling

How long will the Bakken last?

Occasionally I'm asked "how long the Bakken will last?" I refer those who ask that question back to the "Basic Analysis of the Bakken" posted a couple of years ago (2010). The link can be found at the sidebar about a third of the way down.

New numbers and old numbers, new estimates and old estimates, they all keep dovetailing very nicely.

For the past six months, the North Dakota Bakken has been producing about 20 million bbls/month. Some say in another year or two, "we" will get to one million bbls/day or about 30 million bbls/month.

The USGS 2013 survey of the Bakken released today estimated about 7 billion bbls of recoverable oil in the Bakken/Three Forks.

At a steady state of 20 million bbls/month, it takes about 4 years to produce one billion bbls. For 7 billion bbls of recoverable oil, that works out to about 30 years (rounded).

At a steady state of 30 million bbls/month, it would take about 3.75 years to produce one billion bbls. For 7 billion bbls of recoverable oil, that works out to about 20 years (rounded).

How many wells will need to be drilled? The USGS: Continous wells AU has a 350,000 bbls per well and well drainage of 320 acres.

• 7 billion bbls/300,000 bbl-EUR = 24,000 wells (rounded)
• 7 billion bbls/500,000 bbl-EUR = 14,000 wells (rounded)
• At 2,000 wells/year: 7 to 12 years of drilling

Is the boom over?

Some folks have suggested the boom is over, that we have moved into steady-state production. That may be; I don't know. But here's an interesting metric from the "Basic Analysis of the Bakken":

"The increase in jobs and and the demands upon the local area will continue throughout the drilling phase of the industry's development, which will last for the next 15 - 20 years. However, when the industry transitions from the drilling to the production phase, demand for labor in the industry will fall by 90%. ... but then by 2030, 7,200 mining industry jobs will be phased out."

So, I guess that's one metric, or one definition, to tell us when we've moved from the drilling phase to the production phase: the demand for labor in the industry will fall by 90%.

Hmmm.......seven years will go by very, very quickly. It's already been about seven years since the boom began in North Dakota (2007).