Previous post provided daily production and number of wells in the Bakken area and North Dakota overall.
The accountant in me wanted to see the per well data with that same breakout. What did I find?
Productivity of wells outside Bakken is declining. In the Bakken area productivity is much higher and increasing.
Here is the average barrels per day per well. The averages are for NOrth Dakota in total, Bakken only, and then all others outside Bakken:
- ND / Bakken / other / date
- 33.4 / 39.6 / 32.8 / early 2007
- 47.5 / 117.3 / 26.8 / early 2009
- 84.0 / 142.2 / 22.6 / November 2011
Cool – 142 barrels per day. I don’t know much about oil, but that seems impressive to me. The trend even more so.
So that you can revise, recalculate, or challenge my calculations, here’s the data I used:
From the North Dakota Department of Mineral Resources:
- 70,168 bopd – 3,102 wells – January 2004
- 115,028 bopd – 3,440 wells – January 2007
- 187,733 bopd – 3,951 wells – January 2009
- 510,452 bopd – 6,079 wells – November 2011
- 575,490 bopd – 6,636 wells – March 2012
Bakken production info was extracted by Geo ExPro in their article From Trickle to Gusher: the Bakken Oil Story
- 1,500 bpd in 2004
- 12,000 bopd – 303 wells – 2007
- 106,000 bopd – 904 wells – early 2009
- 443,425 bopd – 3,118 wells – November 2011
Just a quick comment since you mentioned you’re not an oil guy.
The way a field works is you drill holes and on day 1 a big number of barrels per say comes out of that hole. Maybe 1500 barrels/day for a Bakken well. But 6 months later it’s already dying. Horizontal wells die vertically, it is said. The right side of the peak on their chart is very steep. Vertical.
So that 142 number you are celebrating is the sum of ENORMOUS amounts of drilling to counter the deaths of a GROWING number of wells that have already been drilled. The bad news is that every single day, each of those wells gets older and dies a bit more, and the more holes you drill, the more such declines arrive 6-12 months later.
The Bakken is hugely different from Saudi Arabian fields. They have wells producing thousands of barrels per day for decades. When you hear talk that the Bakken has wells that will produce for decades, they mean something different. That Bakken well produced 1500 bpd on day one and in 20 years will produce maybe 1 barrel/day. A point is reached where maintenance on that well, just replacing rusting parts, exceeds that tiny trickle coming out. Then you shut it down.
This is what “empty” looks like. But for now, not that. For now you have spasms of frantic drilling to try to overcome the vertical declines from wells already drilled. When the frantic effort can no longer do that, the peak in production/day is defined.
Owen, thanks for taking the time to comment. Good things to ponder.
I’m aware there is a rapid drop after IP. The sharp drop is in the very early production. Then it hits a gentle, slow decline that runs for a very, very long time. Page 10 of this presentation, https://www.dmr.nd.gov/oilgas/presentations/WBPC2011Activity.pdf, has an insightful graph. Not sure I understand the depth of the immediate drop. That shows what you described, extreme concentration of the production early on.
I did a little math…The graph suggests a typical well will maintain an average of 52bopd for years 4 through 14 and around 15bopd for years 15 through 25. That isn’t exactly dying.
In the those two segments I describe, that’s 1,560bopm and 450bopm. At $70/bbl, that would be in the ballpark of $1.3 million a year for 11 years and then around $380,000 a year for each of another 11 years.
Not great, but not even close to the 1bopd you mentioned. I’d be quite happy with the royalties off that production for years 4 through 25.
I am scratching my head about that rapid drop though. My professional training is in accounting. I look for patterns and relationships. One pattern I keep looking for and not seeing is the rapid rise in the per-well production.
Look at this data, pulled from the ND state site.
Number of wells in Bakken only in the December months of ’06 through ’11 and june ’12: 289, 446, 868, 1,332, 2,064, 3,274, 4,141. That’s an increase of 157, 422, 464, 732, 1210, 867.
With production accelerating like that, the average production should be shooting through the roof. That rate of increase should produce an especially rapid increase in producing rates in 2011 and the first part of 2012. The increase should be extremely huge if wells are essentially dead after 6 or 12 months, as you suggest.
Yet, here is the average daily production in December of each year and June 2012: 35, 74, 130, 124, 133, 142, 144. The big increase was in 2007 and 2008. Since then about stable.
Like I said, I’m still scratching my head.
Thanks again for your thoughts. Got me thinking.