[Econ101]

We are talking about giant oil discoveries. The North Dakota production graph is mind boggling! Just at this production rate, and we can see it is changing fast, the annual value of that crude is about 25 billion dollars. So, the resource may have a total value of 10-20 trillion or more over the next 20-30 yrs.

Thats an amazing amount of value and thats just at the wellhead. The energy and compounds found in that crude are going to be refined, combined, transformed and condensed to leverage its value through these products to hundreds of trillions of dollars. It is a giant new oil discovery and thank God its not the only one. There are more than enough to go around for a century or two for sure.

[Tanada]

$this->bbcode_second_pass_quote('Econ101', 'W')e are talking about giant oil discoveries. The North Dakota production graph is mind boggling! Just at this production rate, and we can see it is changing fast, the annual value of that crude is about 25 billion dollars. So, the resource may have a total value of 10-20 trillion or more over the next 20-30 yrs.

Thats an amazing amount of value and thats just at the wellhead. The energy and compounds found in that crude are going to be refined, combined, transformed and condensed to leverage its value through these products to hundreds of trillions of dollars. It is a giant new oil discovery and thank God its not the only one. There are more than enough to go around for a century or two for sure.

[SamInNebraska]

$this->bbcode_second_pass_quote('Econ101', '
')Listen to the USGS tell us how signigicant the Bakken is and what the quality of these resources are. You must remember the USGS is not in the business of guaranteeing future supplies, their charge by law is to inventory known oil and gas reserves.

[Plantagenet]

$this->bbcode_second_pass_quote('SamInNebraska', ' '),,, as long as we don't compare it to the previously mentioned great hydrocarbon resources, right? Because the Bakken, it ain't in the same size class, the USGS has already said so

[SamInNebraska]

$this->bbcode_second_pass_quote('Plantagenet', '')$this->bbcode_second_pass_quote('SamInNebraska', ' '),,, as long as we don't compare it to the previously mentioned great hydrocarbon resources, right? Because the Bakken, it ain't in the same size class, the USGS has already said so

[ROCKMAN]

Just an aside to the discussion of the size of the “resource” volume: I know it’s just me personally but how large the “resource” number may or may not be isn’t too meaningful. Just another map by some goofy geologist like me. LOL Even the amount of undiscovered "reserves” isn’t of much interest. The amount of PUD (proved undeveloped) starts to get my attention since that requires a certain amount of actual offset drilling and production to occur. But I’ll usually skip past that number quickly and go to the PDP number…proved developed producing. Though the accuracy of the PDP can still be somewhat variable it’s a lot closer to a precursor of URR…ultimate recoverable reserve. In my 38 years I’ve found estimating URR from just the PDP evaluation difficult enough.

Even with a valid URR from the PDP, as someone just pointed out, the only immediate impact on the economy is bopd…bbls of oil per day. Those numbers for the Bakken and the Eagle Ford Shale has increased nicely and IMHO will continue to do so as long as oil prices stay high and new wells are drilled to replace the rapidly declining existing wells. Under those conditions the plays will continue. Until the day, of course, when most of the viable locations have been drilled.

As far as valuing those resources and even PUD numbers all I would do is respond the same to folks who have tried to ague up the value of such reserves they were trying to sell me: go drill your wells and then come show me what you got. Until then you don’t have as much value to sell me. In my experience the confidence in one’s estimate of reserves is directly proportion to how much skin they have in the game.

[Plantagenet]

$this->bbcode_second_pass_quote('SamInNebraska', '')$this->bbcode_second_pass_quote('Plantagenet', '.')..the USGS audio report they clearly say the 7.4 Billion bbls of oil resource in the Williston basin makes it the largest oil basin they have ever evaluated in the lower 48.

[SamInNebraska]

$this->bbcode_second_pass_quote('Plantagenet', '
')Why not face facts? The new USGS evaluation sets the oil resource in the Williston Basin at 7.4 BILLION bbls. This is an enormous amount of oil and it can be produced with current technology.

[Plantagenet]

$this->bbcode_second_pass_quote('SamInNebraska', '
')I do wonder why the Obama administration wanted this report out there, the only change is in another formation, they could have just let the old Bakken work stand and mandated that the Survey do something in an area more related to their campaign contributors and investors. Harold Hamm was firmly in the other camp, and his company is near the top, if not the top, of the drilling heap in North Dakota.

[C8]

Listen- none of this battling over the size of the amount of oil that has been discovered, rediscovered, relabeled, etc. really matters at all. There are 4 harsh truths that vastly overshadow the whole discussion:

1. the extraction rate of shale, etc. may be very small and not offset rapid declines elsewhere
2. the cost will increase as you go to the harder to get to or less high quality shale/sand (probably offsetting technology improvements)
3. other critical resources for production, such as water, are going to become more scarce/expensive as they are used up or droughts hit more often

but worst of all

4. even if all these hurdles were cleared- the result would be to fry the planet and render life on it for humans nearly impossible in less than 100 years

I'm sorry- but this is a complete and total cornucopian FAIL

[ROCKMAN]

P – “The USGS report just released by the Obama Administration ranks this area as the largest oil basin they have ever evaluated in the lower 48.” I guess the POTUS and the boys at the Survey don’t get out much. No, it isn’t the largest…not even a close second. According to THE authority of Texas oil&gas the Permian Basin of west Texas has produced over 29 billion bbls of oil and is estimated to contain an additional 30+ billion bbls of oil left to produce. So they’ve picked up on the 7.4 billion bo in N. Dakota but missed the 60+ billion bo in the Permian Basin. BTW the Permian Basin alone (not all of Texas including the Eagle Ford) is producing as much oil today as the entire state of N. Dakota. None of this takes the rightful shine off of ND but I think it’s nice to keep matters in perspective. Maybe because west Texas is dominated by companies J6P never heard of but it seems the MSM doesn’t know there’s a big drilling boom that been going on out there for a long time.

From: http://www.rrc.state.tx.us/permianbasin/

“The Permian Basin remains a significant oil-producing area, producing more than 270 million barrels of oil in 2010 and more than 280 million barrels in 2011. The Permian Basin has produced over 29 billion barrels of oil and 75 trillion cubic feet of gas and it is estimated by industry experts to contain recoverable oil and natural gas resources exceeding what has been produced over the last 90 years”.

This basin has produced over 29 billion bbls of oil and is currently producing 280+ million bbls of oil per year and the POTUS and the Survey haven’t noticed. Or, to not misquote them, they may have noticed it but haven’t “evaluated” it yet. Someone should tell them about the Internet. Lots of useful info there just a few clicks away. LOL.

I also guess the Survey boys were out sick the day the class covered the Gulf Coast Basin, one of the largest oil basins on the planet. According to the AAPG (http://www.aapg.org/explorer/2003/09sep/gulf.cfm) the cumulative production from just the offshore portion of the GCB is over 13 billion barrels with NG production reaching almost 154 trillion cubic feet. And for those folks who would rather believe the fed govt over the industry: According to MMS’ 2000 resource assessment of conventionally recoverable hydrocarbons in the Gulf, 65 billion barrels of oil equivalent total reserves have been produced, but 71 billion barrels of oil equivalent remain. Of course, we have to be careful since they use that sneaky “oil equivalent” BS. But that doesn’t change the fact that the GCB has already produced almost twice as much oil as they SPECULATE might be recovered from the Williston basin.

[Plantagenet]

$this->bbcode_second_pass_quote('C8', ' ')worst of all...the result would be to fry the planet and render life on it for humans nearly impossible in less than 100 years

[Plantagenet]

$this->bbcode_second_pass_quote('ROCKMAN', 'P') – “The USGS report just released by the Obama Administration ranks this area as the largest oil basin they have ever evaluated in the lower 48.” I guess the POTUS and the boys at the Survey don’t get out much. No, it isn’t the largest…not even a close second. According to THE authority of Texas oil&gas the Permian Basin of west Texas has produced over 29 billion bbls of oil and is estimated to contain an additional 30+ billion bbls of oil left to produce. So they’ve picked up on the 7.4 billion bo in N. Dakota but missed the 60+ billion bo in the Permian Basin.

[Econ101]

Southern Illinois is now open to shale development as the courts clear the way against peak oil politics. Google Southerin Ill oil development.

[ralfy]

Even Saudi Arabia reported a few years back that we've used only 25 pct of oil and gas underneath. At the same time, in 2009 they stated that they would easily reach 15 Mb/d by 2011. Similarly, years earlier experts believed that we would reach more than 110 Mb/d by now and oil at less than $30 a barrel.

There's your "peak oil politics".

[Econ101]

It really doesnt matter what Saudi Arabia says, it matters what they produce. They have a lot more oil, so does North Dakota. Probably close to another million barrels pumped today in the Williston Basin.

The production graph for North Dakota is straight up! Thats powerful, straight Up!!

So much shale is coming on line, is it one discovery or is it regional? We have the Williston Basin, Utah, Southern Ill, California (if peak politics doesnt prevail this will triple known reserves).

There are developments going on world wide. These are the most exciting times in history for the oil business and the millions of Americans working and producing Americas energy!! Go Baby, Drill Those shales!!!

[ROCKMAN]

Sorry P…it doesn’t come close. They used “basin”. Every petroleum geologist understands the difference between a field, a basin, a trend, etc. These are very precise and well defined designations. And the Williston Basin is a basin that contains oil in other formations besides the Bakken. And many of those billions of bbls of oil in the Permian Basin are also in resource formations. Second, there hasn’t been a new resource play or oil basin discovered in the onshore US in over 50 years. The very first NG play developed in the US (ovef 100 years ago) was the New Abany Shale...another Devonian resource play like the Marcellus Shale. The closest anyone can come is the Deep Water play in the Gulf of Mexico. But to be correct that isn’t a new basin but a new trend in the very old and established Gulf Coast Basin. As I pointed out above they were producing the Eagle Ford in the 1940’s. And the Bakken in the early 1950’…with reported production of those early vertical wells in the 300,000 to over 800,000 bbls range.

And I have no doubt that every geologist in the Survey understands the error in that statement. It really is Geology 101. But I also don’t think it’s some conspiracy. I suspect the administration just wanted to put the biggest positive spin they could on the situation. With the economy still not showing a strong recovery I’m sure they are desperate to put out as much positive verbiage as they can muster.

Every "new" discovery, be it Bakken, Eagle Ford, Monterey Shale, etc has been producing oil for decades. The increased production from the resource plays has provided a nice bump up in domestic production. But it has been driven primarily by higher oil prices. As I’ve pointed out before the industry could have been horizontally drilling and frac’ng thousands of Bakken and EFS wells in the 90’s if prices had been adequate for those plays. But in the 90’s oil prices were higher enough for a horizontal drilling and frac’ng boom in the Austin Chalk trend in Texas…a boom that matched every aspect of the current resource plays.

I think it critical for folks to understand the dynamics behind the current boom and increased oil production. The danger is their believing that there is a potential to find more “new” resources to develop. Every oil resource in the US has been identified long ago. Those economic to develop at current prices are being developed. And there are those resource plays that aren’t economic to develop at today’s prices. One day they may also boom…when prices are higher.

[Tanada]

The funny thing about 101 is they are arguing both sides of the issue. $this->bbcode_second_pass_quote('', 'I')t really doesnt matter what Saudi Arabia says, it matters what they produce. They have a lot more oil, so does North Dakota. Probably close to another million barrels pumped today in the Williston Basin.

[ralfy]

$this->bbcode_second_pass_quote('Econ101', 'I')t really doesnt matter what Saudi Arabia says, it matters what they produce. They have a lot more oil, so does North Dakota. Probably close to another million barrels pumped today in the Williston Basin.

The production graph for North Dakota is straight up! Thats powerful, straight Up!!

So much shale is coming on line, is it one discovery or is it regional? We have the Williston Basin, Utah, Southern Ill, California (if peak politics doesnt prevail this will triple known reserves).

There are developments going on world wide. These are the most exciting times in history for the oil business and the millions of Americans working and producing Americas energy!! Go Baby, Drill Those shales!!!

[Plantagenet]

Any oil discovery involving more than 500 million barrels of oil is considered a "giant" oil field.

Clearly there are many "new" giant oil fields being discovered right now, given the billions and billions of bbls of oil now available through fracking.