Peak Oil is You
Donate Bitcoins ;-) or Paypal :-)
Page added on July 16, 2014
The Big One – Russia’s Bazhenov Shale
As U.S. and EU policymakers have imposed targeted sanctions on Russian individuals and firms in response to the crisis in Ukraine, Western companies have sought to insulate their own projects from the political imbroglio and continue developing the country’s vast oil and gas resources.
Exxon Mobil and Shell have joint ventures with Rosneft and Gazprom respectively to explore and produce shale oil and gas from beneath the swampy plains of Western Siberia and both want to be allowed to continue operating there.
It’s easy to see why. The West Siberian basin is the largest petroleum basin in the world, covering 2.2 million square kilometres between the Ural Mountains and Yenisei River, extending from Kazakhstan in the south to under parts of the Kara Sea in the north.
The region contains dozens of super-giant and giant oilfields, including Samotlor with 28 billion barrels of oil originally in place, and Urengoy with more than 350 trillion cubic feet of original gas reserves.
The first oil discovery in the region was made in 1953. Most of the large oil and gas fields were discovered in the 1960s and 1970s. Since then, new field discoveries have been much smaller, which helped fuel the peak-oil panic in the early 21st century.
But more than 90 percent of that oil is thought to have come originally from a layer of black shale averaging just 20-40 metres thick and buried almost 3 km beneath the surface. Now oil and gas companies are trying to figure out how to go straight to the source, known as the Bazhenov shale.
Tapping shale directly has revolutionised oil and gas production in North America. Western oil companies and their Russian counterparts hope it can do the same in Siberia.
Land Of Oil
Everything about Bazhenov is on almost unimaginable scale. It covers an area of almost 1 million square kilometres – the size of California and Texas combined.
The formation contains 18 trillion tonnes of organic matter, according to the U.S. Geological Survey (“Petroleum Geology and Resources of the West Siberian Basin”, 2003).
Bazhenov is estimated to hold more than 1.2 trillion barrels of oil, of which about 75 billion might be recoverable with current technology, making it the biggest potential shale play in the world, according to the U.S. Energy Information Administration (“Technically Recoverable Shale Oil and Shale Gas Resources”, 2013).
To put that in context, Bazhenov contains an estimated 10 times more recoverable oil than the famous Bakken formation in North Dakota and Montana.
Bazhenov could produce more oil than has so far been extracted from Ghawar – the super-giant field in Saudi Arabia that made the 20th century the age of petroleum.
Peaceful Nukes
In Soviet times, geologists were well aware of Bazhenov’s oil riches but were unable to extract them owing to the tight packing of the rock, which meant oil and gas would not flow freely through the shale to the wells.
In 1980 and again in 1985, the Soviet government detonated small nuclear devices underground in the West Siberia oilfields in an attempt to stimulate production.
The experiments were code-named Project Angara and Project Benzene respectively, and were among 21 nuclear explosions conducted by the ministries of oil and geology to stimulate oil and gas production between 1965 and 1987.
“Special explosives were developed by the Soviet weapons laboratories to meet the unique requirements of stimulating oil and gas reservoirs,” according to one U.S. arms control expert (“The Soviet Program for Peaceful Uses of Nuclear Explosions”, 1998).
Now Russian oil companies and their joint venture partners from the West are hoping to produce oil and gas from shale using less extreme methods involving water, sand and chemicals to shatter formations and open pathways for the hydrocarbons to flow to the wells.
Bakken Dreams
Bazhenov is attractive for oil and gas exploration because it has many of the same features that made shale plays successful in North America, particularly North Dakota’s Bakken.
The parallels with Bakken have been made explicitly by Rosneft in presentations to investors (“New age of petroleum”, March 2013).
In the central part of the basin, the Bazhenov is buried about 2.5 km below the surface, similar to the average burial depth in the core areas of the Bakken.
Like Bakken, the Bazhenov is a black, organic-rich shale deposited on the bottom of an ancient sea. It was deposited in an oxygen-starved environment so there was plenty of opportunity for organic material to be buried before it could decompose fully.
Bakken and Bazhenov have a total organic carbon content of around 10 percent in their most prospective areas. Bazhenov contains plenty of Type I and Type II kerogen, which tends to generate oil and gas.
Most of the oil produced from reservoirs sourced from the Bazhenov has been medium gravity (29-37 degrees API), which is a bit heavier than Bakken but still highly prized by refiners.
Like Bakken, Bazhenov is under unusually high pressure for its depth. The clay content of the shale is low, making it suitable for fracking.
Similar to Bakken, Bazhenov is a thin formation. Horizontal drilling will be essential to maximise contact between the wells and the oil-bearing shale, which means mastering difficult drilling techniques.
But unlike the giant oil and gas deposits off Russia’s north coast, most of the Bazhenov is on land, in the same sort of semi-empty wilderness as North Dakota.
Bazhenov oil could, theoretically, be produced by the same sort of extensive manufacturing-like drilling and fracking processes that have been used successfully in North Dakota and Texas.
Political Problems
By 2003, some gas had already been produced from more than 200 wells bored down into the Bazhenov at the Salym and adjacent gas fields, according to the U.S. Geological Survey.
But no significant production from shale had been achieved in other parts of the West Siberia basin. The entire area remains comparatively under-explored for unconventional oil and gas.
The attractions of the Bazhenov for Western oil companies and their Russian counterparts are obvious: an enormous world-class onshore oil resource that would benefit from Western expertise in hydraulic fracturing, horizontal drilling and seismic surveying.
The obstacles are mostly above rather than below ground. Russia has proved a difficult financial and business operating environment for Western oil firms, with abrupt changes in royalties and taxation, regulations, and asset ownership rules.
Political relations between the Russian government and its Western counterparts have been deteriorating for some years, and threatened to rupture completely over the crisis in Ukraine.
In April, the United States imposed sanctions on Igor Sechin, a close confidante of Russian President Vladimir Putin and chief executive of Rosneft. Significantly, however, the United States has not imposed sanctions on Rosneft itself.
Some U.S. foreign policy experts have called for the United States and the European Union to restrict the transfer of new oil and gas technology and ban investment in new oil and gas fields.
The immediate aim would be to compel Russia to heed Western concerns over Ukraine. The longer-term objective would be to deny Russia access to the expertise – especially in complex horizontal drilling, seismic and oilfield visualisation – needed to develop shale deposits, entrenching U.S. superiority in shale energy.
So far, however, Western companies have lowered their profile and successfully lobbied against the imposition of broader sanctions on investing in Russia’s oil and gas sector.
The stakes are just too big. Bazhenov is one of the most promising oil and gas plays anywhere in the world and a key component of future supplies.
With Western oil companies still largely shut out or heavily restricted from producing oil in Saudi Arabia, Iran and Venezuela, and struggling to find low-cost projects in other areas, Bazhenov is simply too important to lose.
27 Comments on "The Big One – Russia’s Bazhenov Shale"
Plantagenet on Wed, 16th Jul 2014 7:19 pm
US oilcos would be nuts to invest in Russia. Where Putin can wipe away laws and seize assets anytime the whim strikes him
Northwest Resident on Wed, 16th Jul 2014 9:25 pm
US oil companies would invest in hell and form a joint venture with the devil if there was enough oil and money in it for them.
GregT on Wed, 16th Jul 2014 9:44 pm
“US oil companies would invest in hell and form a joint venture with the devil if there was enough oil and money in it for them.”
It looks like it may very well be too late for that NWR.
“Ten years from now, twenty years from now, you will see: oil will bring us ruin… Oil is the Devil’s excrement.”
Juan Pablo Pérez Alfonzo, a prominent Venezuelan diplomat, politician and lawyer primarily responsible for the inception and creation of OPEC.
The deal appears to have already been made. Temporary gain for the few, long term pain and suffering for all.
Makati1 on Wed, 16th Jul 2014 9:48 pm
Isn’t it interesting that in these last days, the oil resources so badly needed by the West reside in the East/ME? Basically in the lands/hands of the West’s contrived enemies. Maybe god does have a sense of humor. ^_^
GregT on Wed, 16th Jul 2014 11:10 pm
Isn’t it interesting that the more oil we burn, the further down the road of environmental destruction we go, and the more dependant on oil we become.
We don’t need oil, but we do need oil to satiate greed. Just like curiosity killed the cat, greed will kill the human being.
Norm on Thu, 17th Jul 2014 2:57 am
Gotta have something to put into the Escalade, can’t push it to church on Sunday. Looks like Russian paint thinner will have to do. but there ain’t no peak oil. BAU.
Arthur on Thu, 17th Jul 2014 4:16 am
The idea that the Bakken is unique, is a very US-centric way of thinking. It was the Bakken and one or two other bassins that were responsible for the US becoming the largest oil producer *again* soon and postpone local peakoil with a decade or so.
Although oil exploration and exploitation began in the US and the US remained the largest oil producer until the forties, a circumstance with devastating consequences for the Japanese and their Asian empire, history has shown that the largest oil reserves were not located in the US but elsewhere. It won’t be different with shale. That’s probably why the good and reasonable people at the IEA (not to be confused with the morons at Fox) postulate a possible date of global peakoil of 2035. The same conclusion the oildrum folks arrived at and called it a day and started to pursue a paying career and family.
Davy on Thu, 17th Jul 2014 6:30 am
Art, Siberia is an inhospitable and isolated place that will not be worth producing Shale derived energy. It will be comparable to the Artic that at least will have ocean access for easy oil transport. Siberia has huge coal reserves too but again the distribution will kill that prospect. The coming financial train wreck will eliminate any new plays that will require large capex commitments over long periods. The Kazak development is an example of the risks that will not be affordable in the future. The talk of Siberia is more cornucopian wishful thinking. What we see now is what mostly what we will have in a few years across the board from AltE to new oil/gas development. Not only are the current cost/returns bordering net negatives soon they will be off the chart when the true cost of money and the greatly reduce liquidity hit the financial system. It is over and we are sleep walking in a daydream of all is well and happiness is at hand.
Beery on Thu, 17th Jul 2014 6:35 am
I should think the Oil Drum folks were pursuing careers and families the whole time the Oil Drum was around. Humans are capable of doing more than one thing at a time.
As for 2035, I don’t recall any Oil Drum folks coming out with that date. As for why they gave it up, I suspect it has to do with all the evidence being in and that discussions were getting kinda samey-samey.
rockman on Thu, 17th Jul 2014 7:00 am
Some valid points Arthur. But as far as the Bakken not being unique it certainly is in the US. Remember 80%+ of our “new tite oil” comes from just two formations: the Bakken and Eagle Ford Shale. And this is after hundreds of wells have tested dozens of other shale formations in the US. IOW only a small percentage of the US shales have been proven to have big commercial potential. The combined thickness of the Bakken and EFS is less than 1,000’. The other shale formations in the US measure many tens of thousands of feet in combined thickness. The B and EFS aren’t productive just because they are shales. It does require a specific set of physical parameters for such formations to become major producers. And not the Shell Oil has the final word on the subject but after spending at least $5 BILLION trying to develop US shales several months ago they took a $2 BILLION write down on the books and announced a complete withdrawal from all the US shale plays.
But having said that there will certainly be other shale formations in the world with the same potential or even greater. Whether the Bazhenov Shale is one or not remains to be seen. But there’s another critical factor that will determine productivity: it’s if such formations are drilled or not. The US does have two very unique aspects that account for us being the center of shale development today. First, infrastructure. Basically if you don’t have many drill rigs you can’t drill many wells very fast. The US has more drill rigs the rest of the world combined. In, fact, there are more rigs drilling in Texas then the fast majority of countries on the planet. In Texas if you want to drill your EFS prospect you contract a rig and he rest of the infrastructure to do so: total cost – less than $80,000. Need to build a drill rig to test your foreign shale prospect: $10 million or so. And yes, you can drill many wells with that rig. But what if it turns out not to be a very productive play or the economics of the project drops due to lower oil/NG prices. At the end of 2008 Devon had 18 rigs drilling the east Texas shales. And then NG prices fell and they dropped 14 of those rigs. And paid $40 million in cancellation penalties to the rig companies. And what to happened to those rigs: they were stuck in storage yards collecting dust. Fortunately for the drilling companies the EFS in Texas kicked in shortly and saved many of them from going bankrupt.
OK: you have a commercial shale reservoir and have spent hundreds of $millions of drilling infrastructure. Fine and dandy…now who’s going to pay to drill the play up? The US has many times more public oil companies drilling the shales then there are in the rest of the world combined. As I’ve pointed out before a very strong driving factor behind the US shale drilling effort is from pubcos doing the only thing possible to increase their proved reserve base: drilling the shales. IMHO if the shale plays didn’t exist at least half the pubcos would have disappeared. In fact if there’s a significant drop in oil prices for an extended period of time you’ll see the stock values of a great many pubcos crumble into the dirt.
The rest of the world is dominated by NOC’s…National Oil Companies. They own the mineral rights and often are the only ones allowed to operate in the country. Mexico is an obvious example. And the primary driving force behind an NOC is the same behind my privately owned company: drilling wells to make a profit; booking proven reserves is of little value to either of us. Which is why we’ve spent exactly $0 drilling shales even though we’ve spent $300 million in the last 5 years drilling conventional plays in the US.
So even if there are several foreign shale plays that might actually be more productive then the B or EFS it doesn’t mean we’ll see a boom time drilling effort develop in them anytime soon IMHO.
Aaron on Thu, 17th Jul 2014 7:01 am
I don’t think this vast resource should be dismissed so readily. If the financial system holds together, and I admit that is a big IF, this oil will be extracted and sold. It could keep BAU going for a good few years if it’s anything like the size they say it is.
westexas on Thu, 17th Jul 2014 7:41 am
In 2013, the average Bakken well produced a little over 100 bpd, while the median production rate was less than 100 bpd, with a high per well decline rate–while overall production is still on an upslope.
It seems to me that per well numbers like this are going to make it difficult to make money in higher cost operating areas.
An interesting question is how many Bakken wells will be plugged and abandoned, or shut down, prior to being plugged, within five to 10 years of the initial completion. In the Barnett Shale (Gas) Play, Chesapeake claimed that the wells that they completed on the DFW Airport Lease in 2007 would produce for “At least 50 years.” Five years later, about half of the 2007 vintage wells had already been plugged and abandoned.
And as the Rock noted, and as the Monterey Shale Play case history illustrates, not all US shale plays will be commercially productive, and those that are commercially productive tend to be gas prone.
rockman on Thu, 17th Jul 2014 8:57 am
Aaron – I don’t think anyone is dismissing any of the other potential shale plays. It’s just that the expectations don’t mean sh*t. LOL. At least not until someone starts drilling. And drilling a lot of wells.
I just spent 4 decades listening to geologist tell me how much oil/NG I would find if I drilled their prospect. A the usually had a lot more data supporting their ideas then we have about the Bazhenov Shale et al. And typically their prospects didn’t yield anything close to their expectations. Often times finding no commercial reserves.
The cheapest commodity in the oil patch is words. Drill rigs, casing etc. are a lot more expensive. In the oil patch we make a huge distinction between expectations depending on whether the presenter “has skin in the game”. Meaning are they risking any of their capital or are they talking about what might be produced if someone risks their money to find out if the juice is there or not. It might not be fair and will be incorrect to do so some times, but we tend to believe little coming from folks who don’t have skin in the game.
And as I pointed out even if the Bazhenov Shale does have huge amounts of recoverable commercial oil it will take at least a decade before we’ll see significant additions to global supplies…maybe even 20+ years. And that’s if it really is a big play.
Makati1 on Thu, 17th Jul 2014 9:06 am
Russian oil and Chinese money … the oil will be recovered if it is there. The Chinese have a few trillion Charmin dollars to burn up in the near future or use them for mulch. I’m sure they will use them to build infrastructure and develop resources in a neighboring country that is now their energy partner.
As for temps, yes, it gets cold in Siberia. As it does in the oil fields of Alaska. They have also have hot summers in Siberia, or didn’t you know? Setting records. The Arctic region is heating up faster than the rest of the world. The problem is going to be melting permafrost that supports the pipelines. Cold weather can be managed.
http://www.huffingtonpost.com/2013/07/26/siberia-heat_n_3660212.html
Yes, I know, but they can report the weather without spin … I hope.
Aaron on Thu, 17th Jul 2014 9:12 am
Rockman – totally agree with you that until it’s actually been drilled we can’t know what production to expect from it. All i’m saying is if what they say is true, X10 Bakken is a lot of oil. Let’s just say for a moment, it is comparable in its productivity to the Bakken, only on a bigger scale. That could stave off the effects of declines in world conventional production, as the bakken and Eagle ford have been doing quite successfully.
Davy on Thu, 17th Jul 2014 9:30 am
Mak, Russia is taking on far too many adventures and if you haven’t read China is in a debt spiral. China will need those charmin to wipe their asses when SHTF in that basket case country. As far as if there is oil there money will get it out, well maybe, if there is any loose money around to be sunk into a money pit like Sibera or the Artic. IMA the last frontiers for Russia.
Nony on Thu, 17th Jul 2014 10:00 am
I wonder how the “we knew it all along, just needed price” fits with the “you gotta drill it before you know”? Not just having a go at you, Rock, but serious. I lean more towards the gotta drill it.
Heck in some cases, you have to drill it for a while. Look at TMS. Can they crack the nut or is that just too poor of a play? Look at Utica…massive disappointment because low oil…but now starting to look like gas/NGL shows are high enough for development (and yes, at $4/MCF).
Am I saying they will all work out? No. Bakken and EF have been pretty special in the US context. But I gotta think that there are other shales in Russia, Arabia, ROW that are also promising geologically.
I think the bigger issues than the TOC and the clay content and all that…is if the places that have it, really want to show it. I mean Arabia has a lot of conventional oil they are holding back. There’s a cartel effect on pricing.
eugene on Thu, 17th Jul 2014 11:44 am
Todays comments are interesting. The hopeful dreamers vs the reality of Rockman and Westexas. I’ve been reading about oil for over 20yrs now. The list of opinions vs reality is long. My read is there’s one helluva lot of folks that rattle on about things they know nothing about. Coulds, mights, maybes and shoulds don’t run my car. But theres always prayer for folks so inclined.
Arthur on Thu, 17th Jul 2014 12:27 pm
Beery, I have seen theoildrum projections that accepted 2035 as an upper limit peak oil date. Can’t reproduce that graph,
Arthur on Thu, 17th Jul 2014 12:38 pm
Rockman, thanks for elaborate and informative answer, as always. I would think that as depletion progresses and prices increase, more and more of these ‘plays’ will be exploited, independent of their location, if necessary by US companies.
rockman on Thu, 17th Jul 2014 1:10 pm
Aaron – yep…never say never. But what I see as a stumbling block with the Russian play is that it will develop slowly. IOW the world will keep depleting at the same time. It might slow the eventual date of global PO. But if you’ve read me before, that date is meaningless IMHO. So the question is how long would it take for the Russian shale to impact the pricing dynamic. And I think even if it proves more productive then the B or EFS it will be so slow developing it might have little or no real effect on oil prices globally.
As you know it will never be a question of how much oil eventually comes out of any of these plays but how quickly does it comes out of the ground. Even if the Bazhenov eventually produces 1 billion bbls of oil it won’t start flowing much oil in the next few years. And at whatever high rate it eventually reaches it won’t stay there unless a very intensive and continuous drilling program remains in place. And that will require a very large and new drilling/frac’ng infrastructure that doesn’t exist today in Russia. And won’t until someone is willing to invest $1+ billion in hardware.
shortonoil on Thu, 17th Jul 2014 1:45 pm
Is there a lot of oil in the Bazhenov, probably. There is a lot of oil in the world; the USGS 2000 optimistic projection put it at 4,200 Gb. But that completely misses the point! The real question is how much of it is actually going to be extracted? The cornucopians say a lot; we say very little. There are two reasons for our position, but first let’s look at contemporary petroleum resource evaluation.
The volume of petroleum in an reservoir (OOIP) is determined by its pore volume, initial water saturation, and oil formation volume factor. Pretty straight forward stuff. Petro geologists can tell within a couple of percent how much of it is down there. But the amount that is going to be extracted depends on other values. The price the oil can bring, and its production costs. Since no one knows the price, or cost in the future, they use present price and cost. At today’s price and cost there are X number of barrels to be extracted. That is the number that is reported.
We all know that the price of oil goes up, and so does its cost of production. No one will argue that the cost/price today is the same as it was in 1960. What that doesn’t tell us is the relationship between the cost of production, and price. What we can show is that the cost of production is now increasing faster than the price, and will continue to do so until petroleum is no longer an economically viable product.
We made that determination by employing a complex set of thermodynamic equations, but a little common sense works just as well. It is obvious that the cost of production, if unrestrained, can and will increase forever. The price that the end consumer can pay can’t. The increasing cost of production is fixed by the physics of the situation. Petroleum, and its products will become ever more expensive to produce. The end consumer will become ever more resistive to that increasing price. There is a fundamental force driving cost up, while the consumer is always attempting to push the price down.
The end result is that at some point the two meet. Price becomes equal to the cost of production, and oil production ceases (Rock will tell you that the petroleum industry is not your mamma, they are not going to work for nothing). When will that happen – sooner than you, or most think. The relationship is not linear, like almost everything else relating to petroleum it is exponential! The cost of production is barreling ahead (pun intended), its price increase is slowing to a crawl.
The Russians have a lot of oil in the Bazhenov; how much of it will they pump? Let’s just say, its not going to save the world!
http://www.thehillsgroup.org/
Davy on Thu, 17th Jul 2014 2:06 pm
Classic diminishing returns Short. I try to get the same thing across with the whole idea of efficiency. There is a limit to efficiency gains and the resulting savings. I see many doing things today that will never pay for themselves. I imagine many AltE investments are likewise a net negative. What about all that expensive Nuk power going in in China? I imagine new Nuk is no longer a positive. On and on and on. We are a global world at limits of growth facing diminishing returns with meta-predicaments. IOW pissing up a tree.
HIruit Nguyse on Thu, 17th Jul 2014 3:27 pm
PER ARTICLE:
“Bazhenov is estimated to hold more than 1.2 trillion barrels of oil, of which about 75 billion might be recoverable with current technology, making it the biggest potential shale play in the world, according to the U.S. Energy Information Administration (“Technically Recoverable Shale Oil and Shale Gas Resources”, 2013).
To put that in context, Bazhenov contains an estimated 10 times more recoverable oil than the famous Bakken formation in North Dakota and Montana.”
NOW TO PUT BOTH PLAYS IN CONTEXT:
1; 75 Billion Might Be Recoverable,
2; The world currently uses about 32 Billion Barrels Per Year.
hn
nemteck on Thu, 17th Jul 2014 4:00 pm
“Bazhenov contains plenty of Type I and Type II kerogen, which tends to generate oil and gas.”. Is that true?
I thought kerogen is not readily oil. The Green River formation in the USA contains 3.7 Trillion barrels of potential “oil” but only small experimental production takes place.
shortonoil on Thu, 17th Jul 2014 4:43 pm
“Classic diminishing returns Short.”
Simple, but its seems to be incomprehensible to most. The idea that the last barrel of oil will be orders of magnitude more expensive than was the first, seems to boggle people’s mind. We have been outrunning the Red Queen for a hundred and fifty years, so most can not believe that we are actually going to lose the race.
rockman on Tue, 22nd Jul 2014 12:51 pm
“Let’s just say for a moment, it is comparable in its productivity to the Bakken, only on a bigger scale. That could stave off the effects of declines in world conventional production”. OK…let’s say that. Now let’s say the Bazhenov is no more productive than the other dozen or so shale formations in the US that have been evaluated and proven to have little or no potential to add significantly to US oil production. Let me run down the list of those formations and tell which ones you’ve seen their oil potential hyped up: Caney, Woodford, Palo Duro, Pierre, Hovenweep, Lewis, Mancos, cane Creek, McClure, Baxter, Niobrara, Mowry, Gammon, Excello, Mulky, Horton Bluff, Huron, Chattanooga, Floyd, Conasauga, and Neil. I just went with the bigger shales. I suspect you might not have seen many if not most of those names before. OTOH would you have recognized the Eagle Ford ten years ago?
I also didn’t mention the tite formations that actually fall within the Eagle Ford Shale trend: The Buda which sits directly under the EFS, the Del Rio and Georgetown a little bit deeper. Both have yielded a tiny bit of oil over the years. And then there’s the Frio section which is 15,000’ thick and has been the source rock for tens of billions of bbl of conventional oil production alone the Texas coast. It’s composed of 80%+ shale. And the shallower Miocene section is similar to the Frio section as its many different shales were the source rock of billions of bbls of oil along the entire Gulf Coast including the offshore plays.
Shales are the most common sedimentary rock on the planet. All contain some organic matter. Some have been naturally fractured…some not. Many have been the source rocks for the conventional plays. Many have produced very minor amounts of oil. And it has been proven via the expenditure of $billions that the vast majority of these shales have little or no significant oil potential.
The Bakken and EFS are unique even within the boundaries of the US. There’s at least a thousand times more volume of shale formations in the US compared to the combined thickness of the B and EFS. And yet those two formations account for 80%+ of US shale production.
And what makes the B and EFS even more unique in the world beyond the geology is that they fall in one of the most technologically advanced area of global oil patch, surrounded by private mineral owners/numerous independent oil companies with ready access to 100’s of $billions in drilling capital and all of this coming together in the most political secure spot on the planet.
IMHO the Bakken and EFS plays are extremely unique in the world when you look at all the factors contributing to their development. Anyone can claim the Bazhenov has tens of billions of bbls of in place or technically recoverable or potentially economically recoverable or whatever reserves. But you know what no one can say today: there is X million bbls of PROVED PRODUCING RESERVES in the Bazhenov Shale. And those are the only reserves that can be refined into products the world needs. The Bazhenov Shale might one day be producing 10X as much oil as the Bakken. Or maybe only 1/10 as much. Only time will tell. And given where the Bazhenov Shale is located I would guess it will be a very, very long time.