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Expected lifetime production data for a Bakken well

Lots of news sites are reporting on some data released by the North Dakota Department of Mineral Resources.

Here’s the key data:

Typical well in Bakken and Three Forks fields will produce about 540,000 barrels of oil during a 29 year lifespan.

Cost to drill is typically $7.9M

During that run a typical well will generate:

  • $4.5M to government in taxes
  • $7.5M to royalty owners
  • $2M in salaries
  • $7.9M production costs
  • $20M net profit

Ignoring the production costs over 29 years and ignoring the double count of salary in the salary number and production costs, that means income is at least $41.9M, which implies an assumed $77.60 per barrel price over the lifetime.

Update:  I’ve revised the above info into an income statement here.

Businessweek has a superb paragraph describing the productivity over the lifecycle of a well in an article by James MacPherson in ND: Bakken wells will pump for nearly 3 decades:

An average Bakken or Three Forks well initially produces about 923 barrels of oil daily but drops to about half that within the first couple of years, data show. The wells produce an average of 76 barrels a day after five years and drop to less than 10 barrels daily after 25 years, the agency said.

Here’s just a few of the slew of articles on the info:

A lot of news sources picked up the AP feed and ran it directly.

(hat tip: BakkenBlog News twitter feed @bakkenblog)

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3 thoughts on “Expected lifetime production data for a Bakken well

  1. Pingback: Back of the envelope calculation for the total drilling investment per month in Bakken and the possible revenue over the next year « Outrun Change

  2. Pingback: Lifetime financial data for a typical well in Bakken – revised « Outrun Change

  3. Pingback: Estimate of lifetime financial performance of one Bakken well | Outrun Change

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