The Bakken formation is rapidly emerging as potentially the largest contiguous deposit of oil and natural gas ever surveyed by the U.S. Geological Survey (USGS) in the United States and encompasses approximately 125,000 square miles (80,000,000 acres) in North Dakota, Montana and parts of Canada.
On April 30, 2013, the United States Geological Survey (USGS) released an updated oil and gas resource assessment for the Bakken Formation and a new assessment for the Three Forks Formation in North Dakota, South Dakota and Montana. The assessments found that the formations contain an estimated mean of 7.4 billion barrels (BBO) of undiscovered, technically recoverable oil. The updated assessment for the Bakken and Three Forks represents a twofold increase over the 3-4.3 billion barrels of oil that was estimated in the 2008 assessment.
Since the 2008 USGS assessment, more than 4,000 wells have been drilled in the Williston Basin, providing updated subsurface geologic data. Previously, very little data existed on the Three Forks Formation and it was generally thought to be unproductive. However, new drilling resulted in a new understanding of the reservoir and its resource potential.
In addition to oil, these two formations are estimated to contain a mean of 6.7 trillion cubic feet of undiscovered, technically recoverable natural gas and 0.53 billion barrels of undiscovered, technically recoverable natural gas liquids. This estimate represents a nearly threefold increase in mean natural gas and a nearly threefold increase in mean natural gas liquids resources from the 2008 assessment, due primarily to the inclusion of the Three Forks Formation.
According to the North Dakota Industrial Commission (Oil and Gas Division), North Dakota’s oil production is now producing an estimated 738,000 barrels of oil per day.
The increase in the estimated recoverable oil reserves from the Bakken formation is primarily due to advanced technologies in horizontal drilling and multi-stage completion that have recently been applied to the Bakken formation. Over time, oil companies have learned that it is beneficial to increase the number of hydraulic fracturing stages when completing wells. In a typical 9,000 to 10,000-foot lateral extension of a well, operators may fracture the formation in more than 40 stages.
The International Agency (IEA) has published its World Energy Outlook and, according to the IEA, the United States could become the number one oil producer in the world by 2020. It also indicates that by 2035, the U.S. could reach energy independence and go from being an importer of oil to a net exporter.
“U.S. oil output is surging so fast that the U.S. could soon overtake Saudi Arabia as the world’s biggest producer. Driven by high prices and new drilling methods, U.S. production of crude and other liquid hydrocarbons is on track to rise 7 percent this year to an average of 10.9 million barrels per day. This will be the fourth straight year of crude increases and the biggest single-year gain since 1951.”
“The major factor driving domestic production higher is a newfound ability to squeeze oil out of rock once thought too difficult and expensive to tap. Drillers have learned to drill horizontally into long, thin seams of shale and other rock that holds oil, instead of searching for rare underground pools of hydrocarbons that have accumulated over millions of years.”
Most of this technology is being currently used in the Bakken and is helping the rapid increase in North Dakota’s monthly oil production. Many other shale plays across the U.S. are seeing similar results in oil production by utilizing new technology in horizontal drilling and hydraulic fracturing. As a Bakken-like trend spreads throughout the U.S., so might the increase in oil production, possibly giving us energy independence and the title as the number one oil producer in the world.
The Bakken formation is an interbedded sequence of black shale, siltstone and sand stone and was deposited within the Williston Basin during the Late Devonian and Early Mississippian age. It consists of a lower shale member, middle sandstone member and an upper shale member. These formations are organic-rich and are of marine origin, which make them rich source rocks for oil and natural gas deposits. The middle Bakken’s geological properties and local development of matrix porosity enhances oil production in both continuous and conventional Bakken reservoirs. All three members of the Bakken formation have produced oil and/or natural gas.
The Three Forks-Sanish formation, believed to be a completely separate reservoir from the Bakken formation, lies just below the lower Bakken oil shale formation at an approximate depth of 10,600 feet and is estimated to contain recoverable oil reserves in excess of approximately 1.9 billion barrels. The Bakken and Three Forks Sanish formations continue to be the target of more than 95% of wells being drilled in North Dakota.
USGS Releases New Oil and Gas Assessment for Bakken and Three Forks Formations
Technology Unlocks More Bakken Oil
Texas Oil Facts from the Eagle Ford and Permian Basin
Bakken Crude Oil Price Differential Narrows
Horizontal Drilling: A Technological Marvel Ignored
**There are significant risks associated with investing in oil and gas ventures. The above information is for general purposes only and is not a solicitation to buy or an offer to sell any securities. General information on this site is not intended to be used as individual investment or tax advice. Consult your personal tax advisor concerning the current tax laws and their applicability and effect on your personal tax situation. Just as any investment, initial venture may lose money.