[copious.abundance]

Keep in mind that it often slides or flatlines during the winter anyway.

That said, I wouldn't be surprised at this point if it leveled off even during the spring, unless oil prices rebound pretty quickly.

[Beery1]

$this->bbcode_second_pass_quote('copious.abundance', 'H')ere was a really funny one. We're two years into your 3-year timeline!
Posted Jul 31, 2012
$this->bbcode_second_pass_quote('Beery1', 'O')ver the next three years, I'm getting a big bowl of popcorn and I'm going to watch the cornies backpedalling and denying as their dreams of abundance and energy independence evaporate. It's going to be awesome! I wonder how they'll spin it when their fantasies are laid bare?

[copious.abundance]

As I said above, he irony of certain doomers proclaiming a lack of abundance when the price of oil has been telling them otherwise, cannot be overstated.

As proof of how desperate he is to proclaim himself right, he's resorted to declaring that a mere leveling off of production is somehow a failure of abundance. Really pretty sad.

[Beery1]

Bakken numbers are in for the month. I'm still seeing that the peak was in 2014.

[Tanada]

EIA report in graphic form,

http://www.eia.gov/petroleum/drilling/pdf/bakken.pdf

[PeakOiler]

Well, I decided to post the graph using EIA data through April, 2015:



Time will tell if the highest peak in the graph is THE peak for North Dakota.

I will delete the earliest monthly point as the newest monthly point is added.

See http://www.eia.gov/dnav/pet/pet_crd_crpdn_adc_mbblpd_m.htm

[copious.abundance]

There has been an ongoing thread about the Bakken for several years now.

[Tanada]

I expect North Dakota to decline to something like 600,000 bbl/d by the time of the election next year. Not sure what President Obama's legacy is going to look like in the history books.

[Outcast_Searcher]

$this->bbcode_second_pass_quote('Tanada', 'I') expect North Dakota to decline to something like 600,000 bbl/d by the time of the election next year. Not sure what President Obama's legacy is going to look like in the history books.

[Tanada]

$this->bbcode_second_pass_quote('Outcast_Searcher', '')$this->bbcode_second_pass_quote('Tanada', 'I') expect North Dakota to decline to something like 600,000 bbl/d by the time of the election next year. Not sure what President Obama's legacy is going to look like in the history books.

[shallow sand]

I'd say based on Whiting Petroleum's second quarter report, we have seen peak North Dakota Bakken production. Whiting is the number one producer in the North Dakota Bakken.

Although Whiting's release was company wide, vast majority of their production is in Bakken of ND. They produced 170K BOE per day in Q2. They forecast that to fall to an average of 153K BOE per day in Q4 and hope to average 146K BOE per day in 2016, assuming oil prices stay low.

They will spend $2.15 billion in CAPEX in 2015, but already spent $1.56 billion of that in the first half of the year. After completing 186 net wells in the first half of the year, will complete 65 range in second half of 2015.

Surprisingly they spent more CAPEX per well in Q2 than Q1 of 2015.

The kicker, they spent $2 in CAPEX for every $1 in free cash flow in Q2, yet production only raised 2%. To be cash flow neutral and keep production at 170K BOE per day I estimate Whiting needs $90-95 WTI oil price.

If you do not believe me, go look at their website yourself. $90+ is the breakeven for Whiting to maintain 170K BOE per day. Since WTI is in the high 40s, their production is going to shrink. They are pulling two more rigs from the Bakken.

SM Energy is also pulling two rigs from the Bakken and will see production drop.

Hess is apparently going to continue to burn cash in the Bakken.

Next week will see what Continental and Oasis report.

[ennui2]

$this->bbcode_second_pass_quote('Tanada', '
')When all those miracle oil companies start going bankrupt

[ROCKMAN]

PeakOiler - Nice chart...thanks. Folks should note that production leveled off long before the steep drop in oil prices. And also don't forget the lag time: that dip in production 1Q 2015 came from wells drilled in the last half of 2014. We're just starting to see the reaction on the production side from the drop in rig count earlier this year.

[Outcast_Searcher]

$this->bbcode_second_pass_quote('Tanada', '')$this->bbcode_second_pass_quote('Outcast_Searcher', '')$this->bbcode_second_pass_quote('Tanada', 'I') expect North Dakota to decline to something like 600,000 bbl/d by the time of the election next year. Not sure what President Obama's legacy is going to look like in the history books.

[Cog]

Its Bush's fault is the standard goto answer.

[jesus_of_suburbia]

Are you my mother-in-law?

[PeakOiler]

$this->bbcode_second_pass_quote('ROCKMAN', 'P')eakOiler - Nice chart...thanks. Folks should note that production leveled off long before the steep drop in oil prices. And also don't forget the lag time: that dip in production 1Q 2015 came from wells drilled in the last half of 2014. We're just starting to see the reaction on the production side from the drop in rig count earlier this year.

[Tanada]

$this->bbcode_second_pass_quote('PeakOiler', '')$this->bbcode_second_pass_quote('ROCKMAN', 'P')eakOiler - Nice chart...thanks. Folks should note that production leveled off long before the steep drop in oil prices. And also don't forget the lag time: that dip in production 1Q 2015 came from wells drilled in the last half of 2014. We're just starting to see the reaction on the production side from the drop in rig count earlier this year.

[ROCKMAN]

T – “So are you folks saying that the peak number of sweet spots in Bakken had already been drilled by mid-2014…?” I would say it this way: the most promising looking locations in every play are drilled first. Also the better producing areas via vertical wells in the Bakken have been known for decades so they were focused on first. Of course not all the “best looking” prospects work…hence dry holes and non-commercial producers. And some doggy looking projects do turn into gems.

It’s easier to describe what has gone on in the EFS. As the learning curve developed as to sweet vs sour spots those that had the better acreage drilled them up. But what to do with the less promising locations? Simple: using the same tech but apply more of it. Thus laterals went from 2,000’ to 5,000’+ and frac stages went from several to 36+. This gave the appearance of more sweet spots then there really were. But at a cost: running around $4-5 million in the early days to $10+ million last year. But now with the drilling slump prices have come down a good bit. But, of course, so has the price of oil.

No one has any tech on the board today that’s going to improve the process. And as far as higher oil prices eventually bring a lot of new wells on? A number of reasons to not expect it to happen to a significant level. First, there will be a lot fewer operators in the game. And those that survive won’t have much cash flow or credit lines to toss much capex into the pot. And there will be much fewer service companies, hands and equipment available. Many of those shops are shutting down permanently and the equipment being scrapped.

But it all boils down to the same dynamic: ROR. So lower costs help offset lower oil prices to a degree. And apply drilling longer laterals with more frac stages help make poorer locations look better. But in the end there are a finite number of locations that will be drilled at any price point. Sometime in the future when oil gets back to $100/bbl there will be few shale play locations left to drill because the worthwhile ones have already been tapped. And until that time the currently producing wells will continue their depletion cycle and it will take even more drilling to return to the peak in every trend.