Flashback: Bakken Potential, Jane Nielson, CNBC, Et Al -- April 2, 2024

Locator: 46896B.

This past week it was being reported that North Dakota was approaching 5 billion bbls of crude oil production from the Bakken.  KFYR.

And, then, of course, my all-time favorite: Jane Nielson.

By the way: I wonder if Jane Nielson is still following the Bakken?  

From CNBC, Financial Times, June 11, 2013:

Global shale resources are vast enough to cover more than a decade of oil consumption, according to the first-ever U.S. assessment of reserves from Russia to Argentina.

The U.S. Department of Energy estimated "technically recoverable" shale oil resources of 345 billion barrels in 42 countries it surveyed, or 10 percent of global crude supplies. The department had previously only provided an estimate for U.S. shale reserves, which it on Monday increased from 32 billion barrels to 58 billion.

The pace of oil and gas production gains has consistently surprised forecasters since horizontal drilling and hydraulic fracturing, better known as "fracking", were pioneered in U.S. shale rock formations about ten years ago. Only the U.S. and Canada were producing oil and natural gas from shale in commercial quantities, the department said.

From October 7, 2010 (search "OOIP"):

Whiting's current presentation is here.

Some data points from others:

• WLL says they will recover eight (8) percent of the original oil in place (OOIP)
• WLL prefers < 30 frac stages
• WLL does not care for Eco-Pad format
• In addition to four to five long middle Bakken laterals in Sanish sections, WLL putting in "wing" wells (short laterals) as well as  long TFS laterals

These are comments sent in by readers commenting on Q & A portion of the presentation.

Recovering eight (8) percent of the OOIP is a huge story; original USGS estimates of recoverable oil in the Bakken was in the range of 1 - 3 percent. (I believe those figures came from USGS but might have come from other analysts after the 2008 USGS report.)

From October 29, 2010 (some old links will be broken):

Take a look at the current ERF presentation, specifically slide 19 (ERF's slide numbered "19").

Now, see if you can find some original estimates of recoverable oil from the Bakken (in percent). If my memory serves me well, USGS back in 2008 estimated that about two (2) percent of original oil in place (OOIP) would be recoverable, based on results to date and technology at that time. If I'm wrong on that, please let know (with links).

Then, Harold Hamm, CLR/CEO, said that he thinks some folks are already recovering at a rate of eight percent of OOIP. Two percent to eight percent may not sound like all that much, but it quadruples the original estimate in volume measured in barrels.

Now we have ERF estimating as much as:

• 12 - 16% in the Fort Berthold area, ND, Bakken
• 10 -14% in the Fort Berthold area, ND, Three Forks
• 15 - 20% in the Sleeping Giant, MT, Bakken
• 10 -15% in the several fields in Saskatchewan, Canada

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Flashback: Originally Posted January 25, 2011

The 2013 survey.

Original post linked here.

The 2011 post:

A lot of good information in this story by Eric Fox.

When you finish reading the notes below, you might be interested in a very good discussion going on over at the Bakken Shale Discussion Group regarding almost the very same question, but limiting the discussion to "currently recoverable Bakken/TFS oil. [By the way, I still prefer referring to the Three Forks as the TFS rather than TF, but, I do believe that Three Forks is becoming the accepted name.]

Eric Fox summarizes the current estimates of recoverable Bakken oil:

• CLR's CEO Harold Hamm: 20 billion barrels (in fact, he has said as high as 24 billion barrels); he includes both the Bakken and TFS in his estimates, as two separate non-communicating formations
• US Geological Survey: 3.65 billion bbls of oil; plus 1.85 trillion cubic feet of natural gas and 148 million bbls of natural gas liquids (2008 Survey); their 1995 report said the Bakken had only 151 million barrels
• North Dakota's assessment: 149 billion bbls of oil in place, of which 2.1 billion is recoverable (2008); two years later, ND assessed the TFS at 20 billion barrels in place, of which 1.9 billion is recoverable
• Dr Leigh Price: Saudi Arabian estimates; estimated the Bakken could generate between 271 billion and 503 billion bbls of oil with an average of 413 billion bbls; Price said his numbers are higher because he felt the Bakken oil was trapped in that formation and had not migrated to the Mission Canyon or Madison formation; Leigh put a recoverable estimate at 50 percent, suggesting that approximately 200 billion barrels of oil could be recovered

Fox provides an update of net acreage held by several Bakken players:

• CLR: nearly 900,000
• Whiting: 579,000
• Oasis: 300,000
• BEXP: 368,000
• KOG: 72,000
• Hess: 500,000
• GeoResources: 46,000
• Marathon: 385,000
• Occidental: 200,000
• SM Energy: 81,000

Although net acreage is important, just as in other real estate, in the Bakken it's all about location, location, location. So, without that information, be careful how you look at these numbers. I did not realize, or had forgotten that Whiting had that amount of acreage.

I'm hoping CLR hits an even million acres just for the bragging rights. [CLR has close to 900,000 net acres in the Bakken and the Three Forks. Note: earlier I have posted about the risk of double-counting acres in the Williston Basin. To the best of my knowledge, oil companies are not doing that but watch out for it in presentations.]