Putting The Bakken Into Perspective Again -- High Development Costs -- Remember When The Bakken Was All About The Expense? A $10-Million Well Is Now Considered A Bargain

The WSJ-linked article below is a must-read, to help put the Bakken into perspective. 

A reader was kind enough to send me a long response to the long, meandering post on projected productivity of the Bakken vis a vis the Bentek study. He brought up so many points, it will be awhile to get to all of them. Much appreciated.

The reader sent this WSJ link which I can't remember if I've posted before but it helps put things in perspective: triple-digit oil prices needed to sustain oil production.

Underneath their swagger and bravado, global energy chiefs gathered here for their annual U.S. conference expressed a palpable sense of dread over the soaring costs of their signature oil and gas projects.

"All of us are facing new realities and pressures," John Watson, chairman and chief executive of Chevron Corp., told a hotel ballroom jammed with an international assortment of men in suits and the occasional woman.

"Labor and capital costs have doubled over the last decade." To pay for the rising price of extracting fossil fuels, the industry needs triple-digit oil prices, Mr. Watson warned. "The $100 barrel is the new $20," he said—a sobering statement since global oil prices haven't been in the $20 range since 2002.

Look at the Kashagan debacle. 

On the other hand, as more and more infrastructure is completed in the Bakken, which, hopefully, will help contain costs there.

And there it is, here in the WSJ-linked article:

While the big projects provoke the most angst, there is widespread recognition that the small scale—especially around the U.S. shale boom—has had significant impact. The one place where cost inflation wasn't at the forefront of discussions was shale energy development and how it has benefited the U.S. To drill and hydraulically fracture a well in Pennsylvania or North Dakota costs $10 million, at most. 

So, $10 million/well is now considered cheap? Wow.