Tuesday, September 28, 2021

The Bakken Is Back -- The Core Is Expanding -- September 28, 2021

The advances in the Bakken came even before recent increase in crude oil prices. Now, the price surge. Wow. 


The Bakken is back: this should be nothing new to those who have been following the Bakken --

The Bakken has its own mineral tracker, Joel Brown, who was among the first graduates of North Dakota’s Petroleum Engineering program in 2013. Brown founded Mineral Tracker to help royalty owners, a service that has since been wrapped into First international Bank and Trust in Watford City.

Since creating Mineral Tracker, Brown often hears is that the Bakken is close to being drilled out. But that’s not at all what Brown is seeing in the data.

The real story is much more complex, but it’s by and large story about innovation, and it’s a story about how the Bakken’s producers are defying the odds against them, despite OPEC-induced downturns that might have crushed them.

The core of the Bakken is expanding, Brown said. He sees it most clearly in the estimated ultimate recovery figures for Bakken wells. From 2014 to 2018, estimated ultimate recoveries for Bakken wells have increased nearly 70 percent.

A well drilled in 2013 averaged an EUR of around 240,000 barrels of oil. That had been the average for the 10 years prior, too.

But in 2020, Brown has been seeing much higher EURs. The new average for the state is more like 580,000 barrels. That, in turn, has changed break-evens from what used to be a $70 average to more like $37 per barrel.

In the Ross region, for example, just north of Parshall field, which was one of the first areas in North Dakota that saw prolific Bakken production.

But travel just north of there, and wells typically have not been so productive. That appears to be changing. In 2020, three clearwater wells were drilled and completed with better hydraulic fracturing techniques. Those wells are now projected to have EURs of 750,000 barrels of oil — much higher than the 2020 state average of 580,000.

Assuming costs of completion at $7.5 million, that puts breakevens at $29 per barrel.

Brown sees a similar trend in the Alexandria region in central Divide County.

“It is traditionally one of the poorer performing areas of the Bakken and Three Forks development in the Williston Basin,” Brown said.

But recently, 2019, Hunt Oil did a large-scale completion job with 13 million pounds of sand and 40 to 50 stages for completion. That well’s EUR is projected at 590,000 barrels per day.

“So once again, above our average for the state of North Dakota being drilled in this area where we had written it off to $100 oil,” Brown said. “That 590,000 barrel EUR would correlate to a $36 per barrel breakeven oil price.”

Near the Montana border, Brown highlighted two Gibbons wells that have average EUR of 625,000 barrels of oil, drilled in 2019, and six Missouri wells drilled in 2019 and 2020 with an average EUR of 560,000 barrels. That works out to a breakeven oil price of $36 per barrel.

In the Haystack Butte area, 12 Palmer wells in 2019 were drilled with an EUR of 590,000 barrels, and, in the Dunn County area, there’s even a well that is projected to have 1.6 million barrels of oil over its productive life.

Much more at the link. 


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