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May 01, 2008

Bakken oil study North Dakota only and independent of USGS, Active Companies and list of new 2008 producing wells


The southern play is related to the map trends that are seen in Montana and carrying them over into North Dakota. This activity is currently concentrated around McKenzie County. The northern play is related to the interval that has been producing from the middle member for a number of years. The few wells, primarily along the northern Nesson anticline, have limited production from perforations in the middle member. The Bakken in these wells was not the primary target; that was deeper usually the Devonian Winnipegosis. The Bakken was generally a bailout zone, perforated because the wells were reaching their economic limit or had no other production. [pictures and captions from a North Dakota state presentation made in Regina]

NOTE: As of May 2, 2008, I, Brian Wang, do not own any of these stocks directly. I have some mutual funds but I do not know what stocks are held there.

This article provides information on companies, links to North Dakota state reports and presentation and North Dakota released wells and initial production from each well.

This article indicates exactly how fast the Bakken is playing out. 5000 to 9000 barrels of oil per day per month in North Dakota are being added. This does not include Montana, Saskatchewan and South Dakota or Manitoba. Since the end of 2007, 23000 barrels of oil per day more oil from North Dakota (138,000 bopd total)increase to the end of February, 2008. [Most, 80-90%, from the Bakken.] A simple projection would be that 100,000 barrels per day could be added in 2008. On the positive side : Drilling activity is increasing. The summer should have more activity. On the negative side: there is the decline rate of wells, average new wells may not be as good as January and February. I will monitor and write updates as the 2008 and later information rolls in.

I focused on Saskatchewan in a separate article. Initial production has tended to decrease an average of 60% of initial production [decline rate].

Wells stay confidential for 6 months. ND also releases its actual monthly production from 3 months ago.

Sometimes during quarterly earnings reports companies will pre-release well production info generally if they have good news, like to 3000 barrels per day from two new wells from EOG / Enron Oil and Gas). In the further reading section I have and will add links to quarterly earnings transcripts for relevant oil companies. I will have the quarterly earnings call transcipts for more companies involved in ND Bakken as they become available.

Looking at only the North Dakota portion of the Bakken oil field

UPDATE: Welcome instapundit readers.

The Bakken shale formation in North Dakota holds up to 167 billion barrels of oil but only about 1 percent of it can be recovered using current technology, a new North Dakota state Department of Mineral Resources study says.

DETAILED INFORMATION
Here is a link to the daily drilling activity report for North Dakota It lists wells permited, completed, dry and released from confidential status.

Here was a big list of released from confidential status. Wells stay on the confidential list for 6 months after they are completed.

EOG Resources, Marathon Oil, Headington Oil, Continental Resources, Hess Corporation, Petro Hunt has several wells.

Some of the smaller players with poor well production might not be using the latest and best horizontal multiple fracturing methods or some may just be drilling into poorer parts of the formation.

Just from the April 28, 2008 well information release 9411 barrels of oil per day.
WELL                                                 BOPD 
#16469 - EOG Resources, Herbert 1-26H, Mountrail Co. 1267 
#16637 - EOG Resources, Long 1-01H, Mountrail Co.    1058 
#16776 - Hunt Oil, Bowman 1-18H, Bowman Co.           864 
#16713 - EOG Resources, Austin 1-02H,  Mountrail Co.  781 
#16751 - Marathon Oil, Reiss 34-20H, Dunn Co.         524 
#16664 - Headington Oil, Basaraba 44X-27, Billings Co 485 
#16730 - Burlington Resources, 11-14H,  McKenzie Co.  456 
#16704 - Marathon Oil, Darcy 34-32H, Dunn Co.         398 
#16729 - Marathon Oil Co., Vihon 44-8H,  Dunn Co.     348 
#16694 - Hess Corp, Ha-Mogen-152-95, McKenzie Co.     348 
#16750 - Sinclair Oil , Uran 1-22H, Mountrail Co.     337 
#16749 - Headington Oil, Ekren 44X-5,  Williams Co.   312  
#16451 - Marathon Oil , Gerald Tuhy 21-4H, Dunn Co.   225 
#16683 - Burlington Res, Federal Jorgenson 14-5H,Dunn 224 
#16748 - Samson Res, Sparks 4-162-98H, Divide Co.     197 
#16725 - Petro-Hunt, Gordon Hall 29C-3-1H, Divide Co. 119 
#16663 - Petro-Hunt, Torgerson 15B-2-2H Mountrail Co. 117  
#16560 - Samson Res, Hanisch 28-163-98H H, Divide Co.  58 
#16737 - Continental Res, McGinnity 1-15H, Divide Co.  53
8171 

14% of the new oil production in North Dakota was not in the Bakken for the April release. The above list removed wells for the Red River, Madison and Devonian. About 1300 bopd.

After the jump more wells from

March 13, 2008 had a large release of well production information


Bakken North Dakota Isopach. Distribution of the Middle Member throughout North Dakota and Montana. Note the prominent trend in the isopach coming in from Richland County, MT and the depositional center just to the east of the Nesson Anticline.









WELLS                                                   BOPD  
#16578 - EOG Resources, Risan 1-34H, Mountrail Co.       817 
#16635 - EOG Resources, Sampson 1-12H, Mountrail Co.     581 
#16715 - Marathon Oil, Kevin Buehner 11-18H, Dunn Co.    463 
#16656 - Headington Oil, Hazel 44X-22,Williams Co.       411 
#16695 - Hess Corp, Ha-Chapin-152-95 3229H-1,McKenzie Co 392 
#16726 - Marathon Oil, Benz 24-21H, Dunn Co.             278 
#16699 - Continental Res., Jones 11-33NH,  Bowman Co.    277 
#16572 - Encore Operating, Sadowsky 44-1H, Dunn Co.      261 
#16724 - Continental Res, Spry 21-13NH, Bowman Co.       232 
#16702 - Continental Res, Sophia 44-12SH, Bowman Co.     228 
#16676 - Murex Petroleum, Ryan Thomas 27-34H,Williams Co 223
#16701 - Headington Oil, Ramberg State 14X-15,Williams   192
#16744 - Tracker Resource Dev, LLC, Trampe 1-1H, Dunn Co 163
#16703 - Burlington Res, Kelly 44-2H, Dunn Co.           144 
#16738 - Zenergy, Ft. Buford 1-16H, Williams Co.         125 
#16710 - Hess Corp, BL-Wallentinson-156-95, Williams Co. 110 
#16677 - Marathon Oil, Beck 24-8H, Dunn Co.              101 
#16642 - Continental Res, Jorgensen 21-4 SH, Bowman Co.   54 
#16428 - Summit Res., Summit State 26-34, Billings Co.    22 
#16712 - Hess Corp, NSCU P-715AH, Bottineau Co.           17 

bopd  5091


Feb 11, 2008 another big well information day

#16484 - EOG Resources, Wenco 1-30H, Mountrail Co.        1670
#16691 - Continental Resources, Inc., Lamb 11-24NH, Bowman Co. 614
#16542 - Whiting O&G Corporation, Lindvig 11-13, McKenzie Co. 560
#16598 - Continental Res, Kid Creek 44-29NH,  Bowman Co. 519
#16571 - Burlington Res, Lillibridge 11-23H,McKenzie Co. 476
#16647 - Burlington Res, Corral Creek 34-33H, Dunn Co.         439
#16611 - Marathon Oil Company, Carlson 21-29H, Dunn Co.         428
#16629 - Whiting O&G Corporation, Solberg 32-2, Williams Co. 420
#16439 - Marathon Oil, Hecker 21-5H, Dunn Co.                 373
#16689 - Helis O&G, L.L.C., Linseth 4-8H, McKenzie Co.   373
#16678 - Encore Operating, L.P., Truchan 11X-33H, Dunn Co. 315
#16653 - Prima Exploration, Inc., Paradox 11-30H, Burke Co. 285
#16502 - Encore Operating, TR Madison Unit 21-14H, Billings Co. 276
#16610 - Hess Corp, BB-Olson-150-95 0817H-1, McKenzie Co. 267
#16670 - Continental Res, Jean Nelson 1-35H, Mountrail Co. 266
#16634 - Petro-Hunt, L.L.C., Wold 31D-4-3H,Burke Co.      187
#16638 - Zenergy, Inc., Charbonneau 1-14H,  Williams Co. 143
#16723 - Zavanna, LLC, Brushy Bill 1-19H, Williams Co.         140
#16679 - BTA Oil Producers, 20401 JV-P Nelson Williams Co. 138
#16420 - Summit Res, Williamson Federal 2-26, Golden Valley Co. 102
#16568 - Samson Resources Co, Holm 33-163-98H, Divide Co. 102
#16529 - Continental Res., Spry 11-13NH, Bowman Co.         100
#16681 - FH Petroleum Corp., Marie 24-28, Golden Valley Co. 72
#16706 - Hess Corporation, BLSU D-405,  Williams Co.         56
#16609 - Continental Resources, Inc., Jost 1-20H, McKenzie Co. 38
#16617 - Hess Corp, Bl-Heen-156-95 2227H-1, Williams Co. 38
#16688 - Hess Corp, NSCU M-717AH, Bottineau Co.           34
#16692 - BTA Oil Prod, 20401 JV-P Gohrick 43-17, Williams Co. 32
#16641 - Continental Res, Jorgensen 21-4 NH, Bowman Co.         25
#16655 - Hess Corporation, BLDU B-305, N, Williams Co.    11
#16697 - Primewest Petroleum Price 5H, Williams Co.         10
BOPD 8509


Jan 4, 2008 another big well information release day.

North Dakota's Bakken oil is increasing at about 6000-7000 barrels of oil per day per month. The trend is for another 50,000-60,000 barrels of oil per day to be added this year (2008) For North Dakota's Bakken oil production.


Another process that affects the Bakken section is hydrocarbon generation. The Bakken is a rich source rock with TOC values ranging up to 40%. This map shows the maturity of the Bakken as a source rock. Areas of intense generation are found in McKenzie and the eastern portion of Richland Counties.


NORTH DAKOTA STATE STUDY
Current technology could lead to the recovery of about 2.1 billion barrels in North Dakota's the "middle Bakken" formation, where oil-producing rock is sandwiched between layers of shale about 10,000 feet under the ground. Helms said the federal [USGS] study focused on the performance of wells currently working in the Bakken, while the state "went back and looked at the rock."

Ron Ness, president of the North Dakota Petroleum Council, said it costs more than $5 million to drill a Bakken well, and dozens are currently producing.

"What industry is mostly concerned with is to find - economically - what is going to work in the Bakken," Ness said. "What we have right now is one big scientific experiment going on out there."

The U.S. Geological Survey estimated that up to 4.3 billion barrels of oil could be recovered from the Bakken shale formation in North Dakota and Montana, using current technology.

That report was done independently of the state study, Murphy said.

"Their numbers also include Montana, ours only includes North Dakota," he said.

The federal report found up to 2.6 billion barrels could be recovered in North Dakota, compared with the state's estimate of 2.1 billion barrels, Murphy said.

FURTHER READING
The Bakken oilfield in context. This article reviews the oil megaprojects around the world. The Middle east, Russia, Khazakistan, Brazil are still the bigger players. The USA should have a deep oil rig, Thunder horse, coming online in 2008 and it should reach 250,000 barrels of oil per day sometime in 2009.

The confidential well list for North Dakota

A discussion on which stocks to invest in to take advantage of the Bakken oil development

EOG, BEXP, CLR , WLL and NOG, perhaps even others like HESS

EOG Resources, Inc. (EOG)
Whiting Petroleum Corp. (WLL)
Brigham Exploration Co. (BEXP)
Northern Oil and Gas, Inc. (NOG)
Continental Resources (CLR)
Marathon Oil (MRO)
HES corporation Q1 2008 earnings call transcript

On the Bakken, we [HESS] currently have net 410,000 acres or so. We're still in the business of acquiring more acreage provided it makes economic sense. We have 50 operated wells in the Bakken. We expect production in 2008 to be around 8,000 barrels a day. We're running six rigs. By the end of the year we'll go up to eight, and by 2009 we'll go up to 10.

Individual well rates with rates being the average of the first 30 days of production range from about 100 barrels a day to 400 barrels a day. We see some variation in the reservoir quality in an aerial sense. We're doing a lot of work to model the subsurface, to understand the geology better, and we're also continuing to do work to optimize completion practices, particularly fracing technology.


EOG Resources Q1 2008 May 2, 2008 earnings call transcript

Our 8-rig North Dakota Bakken development is proceeding as anticipated and is still averaging 100% direct after-tax reinvestment rates of return. We're consistently making very good wells.

Austin 8-26H well that was completed at the end of February had an initial production rate of 3,060 barrels of oil per day. Recently, we completed the Austin 6-15H well that had an initial production rate of 3,630 barrels of oil per day. These are the two best wells in the field today, and I will note that those are probably two of the best wells in recent history in the Bakken play in North Dakota in its entirety.

Within the Parshall field, very strong initial production rates are now routine, similar to our frequency of monster wells in the Johnson County. The more drilling we do, the more confident we are regarding our net 80 million barrel reserve estimate for this asset.

The upside to this estimate will be determined in three possible ways: First, by extending the field limits and step-outs really; second, by a possible 320-acre downspacing; and the third, by secondary recovery. The field is currently being drilling on 640 acre spacing, and we are currently completing our first 320-acre downspace well.

We will need several months of production history from the well in order to determine the impact to any increase in reserve recovery versus acceleration. I expect that by yearend, we'll have a definitive idea regarding the Bakken reserve side.

EOG currently has 320,000 net acres in the entire Williston Basin and the field that we always talk about, partial field including those 3000 barrel a day, Austin wells, really only it comes to about a 110,000 of those 320,000 acres. So, answer to your first question is absolutely, yes. We believe that there are other perspective areas within the Williston Basin that we have currently leased and we will be testing in the future for oil prospects.

[On the USGS 3.7 billion barrel estimate] The USGS estimate is the entire shale will work to the tune of maybe 25,000 total locations, wells to be drilled, and that's where we think it's perhaps a little optimistic. The shale may not be intact...Parshall is such a sweet spot because of fracture density in the facies of the rock and that will probably not be true in very many other places in the Williston Basin. So, in summary, I'd say that the overall number is not incorrect; it's just perhaps optimistic.


On the North Dakota state site the Austin 8-26H well is still listed as confidential. #16885 NWNW 26-154-90 and won't be released by the state until Aug 14, 2008. But obviously EOG is talking about it. They seem to hold the information confidential for 6 months.

16954 EOG RESOURCES, INC. AUSTIN 6-15H SWSE 15-T154N-R90W 10/8/2008

Continental Resources Q1 2008 earnings call transcript.

[Continental Resources] has increased our 2008 CapEx budget for drilling, land and seismic by $167 million, which is 27% higher than the budget approved last November. $65 million of this increase is allocated to the Bakken play in Montana and North Dakota where we have a dominant operating position.

Finally, even as we are successful in one area, we must be engaged and prepared to take new positions of significance in other resource plays as a potential in mergers. This is what Continental has accomplished in the Bakken and the Woodford, and is committed to achieve elsewhere in the United States. We are prepared to talk today about a play in Western Oklahoma and Texas Panhandle, some of you have called our stealth play.

We began 2008 with 13 operated drilling rigs. We now have 22, and we expect to reach 30 by yearend. As a result of this increased activity, we expect our 2008 production exit rate will be about 43,000 barrels of oil equivalent per day, or about 42% higher than average rate for the first quarter just ended.

Continental recognizes potential early in the development of play and began leasing back in 2002. As a result Continental is the largest producer and controls the largest acreage position in the Williston Bakken play today, with approximately 487,000 net acres under lease. And we continue to build our position with 66,000 of acres added so far this year.

Continental is also one of the most active operators participating in one-third of the 74 Bakken wells currently drilling in the play.

We will be increasing that count to 12 in May and 13 during the third quarter with the additional rigs being deployed in North Dakota. There are also three additional rigs operated by ConocoPhillips that are drilling on the company's behalf within the 50-50 area of mutual interest in North Dakota.

Drilling results had been inline with our expected average recovery of 300 Mboe gross from our 320 acre infilled and 640 tri-lateral drilling in Montana as well as our 1,280-acre drilling along with Nesson Anticline in North Dakota.

During the quarter, we completed 18 gross, 8.1 net wells. And as detailed in the press release, you can see some of our more recent completions with 7-day initial production rate ranging from 348 to 609 barrels of oil equivalent per day. The average 7-day initial production rate for all wells completed so far this year has been 340 barrels equivalent per day.


Whiting Petroleum Q1 Earnings Call transcript

[Whiting] continues to generate excellent results from our Bakken drilling program in North Dakota where we recently brought in the Maynard Uran Trust No. 11-24 with an initial production rate of 2,132 BOEs per day. We own an 84% working interest and a 68% net revenue interest in this well.

Turning to our Bakken play, our net production from the middle Bakken formation in the Sanish and Parshall fields of North Dakota, totaled 3,344 barrels of oil per day during the first quarter of 2008. This represents a 92% increase in that same volume number over the fourth quarter of 2007. Net production from these fields in March rose to 4,153 barrels of oil per day or 9.9% of March's 41,800 BOEs per day.

In our Sanish field, in Montreal County, we completed the Maynard Uran Trust 11-24H on April 23, flowing 1,923 barrels of oil and 1.3 million cubic feet of gas per day from the Middle Bakken formation at a vertical depth of approximately 10,300 feet. On an equivalent basis, this equates to the previously stated 2,132 BOEs per day.

The triple lateral was drilled on a 1,280 acre spacing unit and penetrated more than 20,000 feet of horizontal pay. Whiting holds an 84% working interest and 68% net revenue interest in this new producer and of course we are the operator. We are currently drilling or completing 6 wells in the Sanish field, 4 operated, 2 non-operated, and one well is waiting for the lateral to be drilled.

We are also completing a 100% working interest well in the northern portion of the neighboring Parshall field. This well is known as the Lee State 44-16H well. We expect to have as many as 9 rigs working in the area by year-end 2008.

In 2008, we plan to drill approximately 36 operated wells in the Sanish with an average working interest of 81%. We expect most of these to be single-lateral wells drilled on 1,280-acre spacing units. Ultimately, we may drill two single-lateral wells per 1,280-acre spacing unit. Along with some potential in-fill drilling, we estimate we could have up to 230 total well locations in the Sanish field. Our net production in the Sanish field alone in March 2008 averaged 1,175 barrels of oil per day.


Well search by company name

Petrobank Energy & Company NPV PBG.TO is a good investment for Saskatchewan's part of the Bakken [Crescent Point and Tristar are also succeeding in Saskatchewan's Bakken oil]

Northern Oil and Gas, Inc. (NOG)

Detailed presentations on the North Dakota Bakken oilfields

It is about 29000 bopd from the totals of initial production for North Dakota.
I need to weed out some of the red river numbers.

I will be adding highlights from the North Dakota presentations on the Bakken
Isopach maps etc...

Cumulative oil production by formation in North Dakota

Production by formation for 2007

The USGS assessment with 38 powerpoint slide discussion.

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7 comments:

Anonymous said...

Hmm...this won't help to offset Peak Oil, you know that right? I mean Peak Oil is here already. Nothing can save us, or preserve our way of life. You should get off the grid while ytou still can. I've been off the grid for 8 months now. I'm prepared. ONce the powerdown occurs.....technology goes right our the window. Become a survivor, not part of the dieoff.

bw said...

I disagree. The information in hundreds of posts under the energy heading explain why.

There would be a global peak in oil and related liquids when production falls consistently but we are making new highs in terms of more production. My mega oil projects article shows what production I expect to come online.

Demand growth has been higher than supply, but that is not peak oil.

If you want to comment more then read my energy articles first or at least my oil and oilsand articles.

Anonymous said...

On the first map, the county shown as Oliver is Mercer!

Patrick said...

If Enron told me my hair was on fire, I might well wait to smell smoke before I reached for a bucket. I question the accuracy of the Enron Oil and Gas reports because I've seen how rife with fraud their reports in other energy fields are. I am insufficiently familiar with how EOG could be salting these reports to make specific accusations, but the disproportionately productive finds by EOG concern me.

Nevertheless, running in terror from the great demon "Peak Oil" does seem a bit excessive. If you have the coin to get off the grid, more power to you, so to speak. I just hope the energy pricing bubble we're in lasts long enough to capitalize more exploration and development of resources in the US.

We might even pressure Congress to get real, but that seems less of a risk than the "Peak Oil" demon fantasies.

Suzanne said...

"Initial rates" or "came on at" or "initial production" are very misleading terms. I know for a fact that several wells in the Bakken that have come on at high rates, between 2000 and 3000 have dropped off immediately to around 800-1000...sad when oil and gas guys are no better than used car salesmen to get investors all pumped up. And in ND since they can request confidentiality, we don't know the extent of the drop off until 6 months later. I'd never put my money in any company that "needs" confidentiality.

bw said...

Suzanne,

I did state that there is an average decline in well production from the initial rates. It is mentioned in about the 7th paragraph (so near the top). Plus it has a link to an entire article talking about decline rates for the Bakken. I do not see why you think initial production rates is misleading. The terms clearly indicate "here is what this thing is starting out" there would be no need for the term if "this is what starts at and it will stay the same".

In terms of the 6 month confidentiality. All companies take time to submit their financial information to regulators or state agencies. The 6 month period of confidentiality does not seem unusual to me.

I think that gold mines, diamond mines would have similar periods.

It would allow a company to still acquire nearby properties during that time.

A provisional patent filing gets 1 year from the time of filing before the information is made public. They also have that one year time to file a full patent.

Bruce Oksol said...

You are correct; 6-month confidentialty is the norm. Suzanne must be a newbie.