We need to learn quickly to keep up with the massive change around us so we don't get run over. We need to outrun change.
Forecast from Wood Mackenzie, as announced in Oil & Gas Financial Journal: Bakken Drilling and Completion Capex to Top $15B in 2014.
Their predictions:
Highest 30 day Initial Production rates are above 1,000 bopd in the Nesson Anticline.
EURs are highest in the Fort Berthold subplay at 700,000 barrels.
Peak what?
A few years ago, I would have had a 500 word post on each of the following articles from Million Dollar Way. Now I’m to the point where I get the knowledge quicker and only want to summarize in a few sentences. The news in these two posts is huge: First, the horrid Bakken decline rate might not be as big a deal as previously thought. Second, the drilling rate of 2,500 new wells a year is probably sustainable.
Wow.
The declining relevance of the decline rate
3/31 – Million Dollar Way – Decline Rate And The Bakken – Continue reading “More good stuff on the Bakken – decline rate and sustained drilling – 4-8-14”
Here’s a few quick notes on interesting news that I won’t cover in a separate post.
3/25 – Alberta Oil Magazine – Here We Go Again – The second wave of the horizontal revolution is on its way – Continue reading “More good stuff on the Bakken – 4-3-14”
Million Dollar Way has a complex post describing the increasing density of wells on each portion of land being drilled in North Dakota. Think 14 or 28 wells on 4 square miles. I’ll try to pull a few key ideas out of An Example of “Ears Pinned Back” — As CLR Calls It – In The Bakken.
Density in 2007
In ancient days, say about 2007, the concept was one well on a section. That according to the article.
Density in 2011
The change in oil production in the last few years is astounding. For perspective, look at the following two charts by Prof. Mark Perry, from his Carpe Diem blog. Both graphs used with permission:
Oil production in Texas:
From The remarkable rise of Texas crude oil: The state produced nearly one billion barrels last year, and 34.5% of all US crude. Just under a billion barrels. That’s around a third of US production.
Oil production in North Dakota took off in 2008: Continue reading “The shale revolution. Or, what Peak Oil? #33”
Okay, I’m using a very loose definition of field. But check out the following graph of combined oil production from those five states. We’re talking production level of super-giant fields.
Graph is from Carpe Diem, Shale prosperity spreads to Wyoming, Colorado, Oklahoma, Utah, N. Mexico: Combined oil production up 56% in 3 years. Graph is used with permission of Carpe Diem.
Prof. Mark Perry calculates combined production increased Continue reading “Another major oil play to keep an eye on: The Wyoming-Colorado-Oklahoma-Utah-New-Mexico “field””
Bloomberg – North America to Drown in Oil as Mexico Ends Monopoly
Potentially another game changer for world-wide energy – – the Mexican legislature has changed national law to allow foreign investors to own oil reserves. This will draw the major oil companies with their talent, equipment, funding, and infrastructure. Speculation is oil production from Mexico could double in a decade.
Still some major obstacles, but the potential is huge. The Mexican government and her people could benefit tremendously. I really hope they handle this well, for their good and the good of everyone who uses energy.
Newsday – Remember the energy crisis? Fracking fixed it.
Notice that the constant stories of the “energy crisis” isn’t in the news anymore. If you were around in the ‘70s you remember long lines to buy gas on your assigned even or odd day. Crisis stories continued for years, through the entire Carter administration and beyond.
Lots of production companies around Bakken are going to expand hiring in ’14. Bismarck Tribune reports Oil service companies on hiring blitz.
The rapidly increasing number of wells is creating permanent jobs to service the wells. Each well requires attention. I’ve read elsewhere that each well creates the need for one full-time position. That would be about 8,000 permanent jobs for the existing wells, with 2,000 new positions a year.
Two key comments, for me at least: Continue reading “Hiring in North Dakota to pick up – “blitz” in ‘14”
A major part of the efficiencies well drilling in Bakken is putting multiple wells on one site. This saves a huge amount of time to set up and take down the rigs. Instead of disassembling/ transporting/ re-assembling, the still-assembled rig side-steps a few feet and the crew resumes drilling.
Continue reading “Multiple wells on one site – Pad drilling”
Production in the state increased to 941,843 barrels of oil per day in October from a slightly revised 933,191 bopd in September.
The Director’s Cut report says bad weather is the reason for a small increase in production: Continue reading “North Dakota oil production increases just under 1% in 10-13”
Wow. Ten times more drilling than has already happened. Speaking to the state legislature, Mr. Lynn Helms, who is the director of the Department of Mineral Resources, said
…the western part of the state had 6,447 wells in the oil-rich Bakken and Three Forks formations. Fully developing the formations will require drilling another 60,000 wells over the next 20 years …
Several great reads on energy. Lots of info. Since they are long, you might want to get a fresh cup of coffee and settle in for some good learnin’.
Superb background on Harold Hamm and Continental Resources. Mr. Hamm has a couple of fun quotes in the article. For example, some people say the oil industry is creating carbon pollution. He points out that all humans exhale carbon dioxide. Should we all quite breathing?
I think not.
How about enough oil for a hundred years? Check out this sentence: Continue reading “3 articles for background on fracking and oil”
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Production of Bakken oil in North Dakota will soon hit one million barrels a day. When it does, it will be one of only 4 fields in the U.S. to hit that level. Those 4 are part of an elite group of only 10 super-giant fields.
Applying some new trend analysis concepts, the EIA is predicting Bakken production will be 976K bopd in 11-13 and 1,002K bopd in 12-13.
I’m not sure if that estimate includes production from legacy wells. Even if it does and we back out September production of 65K bopd that only changes the date of crossing the 1M point by a month or so. That doesn’t matter for purposes of this discussion.
Their calculation shows Eagle Ford has already passed the 1M point. Permian production has been over the 1M point (again?) for a while and is at an estimated 1,340K bopd in December.
Along with Prudhoe Bay that makes four American fields that passed the 1M point.
Continue reading “Bakken and Eagle Ford in the elite of super-giant oil fields”
Having a well drilled near your house generates a lot of disruption. There is noise from the drilling, with something on the order of 2,000 truck trips and round-the-clock lights. I’ve been told you can feel the rumble in the ground when fracking is going on near you.
An article in the Wall Street Journal explains Energy Boom Puts Wells in America’s Backyards.
Million Dollar Way points to a must-read article at Rigzone: Kemp: Why Shale Plays really Are Different.
The article describes why perennial skeptics have been so severely wrong about Bakken shale oil, why the rapid decline rate is actually attractive, and explains shale oil is more manufacturing-like than conventional oil.
The “optimists” were conservative
Continue reading “Why shale is such a misunderstood game changer”