More On The Bakken Oil Formation  

The Bakken oil formation seems to be the oil story of the week, with the excitement apparently generated by the USGS announcement expected on Thursday.

BusinessWeek has a report on the USGS announcement - Report on Bakken oil potential expected.

A long-awaited federal report on oil that could be recovered in parts of North Dakota, Montana and two Canadian provinces is to be released this week. The Bakken shale formation encompasses some 25,000 square miles in North Dakota, Montana, Saskatchewan and Manitoba. About two-thirds of the acreage is in western North Dakota, where the oil is trapped in a thin layer of dense rock nearly two miles beneath the surface.

Ron Ness, president of the North Dakota Petroleum Council, said the number of wells in the Bakken increased from about 300 in 2006 to 457 at the end of last year. Bismarck-based MDU Resources Group Inc. announced its first venture into the Bakken this week.

The study being released Thursday by the U.S. Geological Survey was done at the request of Sen. Byron Dorgan, D-N.D., over the past 18 months. "Technology continues to advance," Dorgan said Monday. "This is not going to be a red light or green light about oil development in the Bakken -- clearly there already is a big green light there. But I think the question is pretty clear: How much of that oil is recoverable using today's technology?"

In 1995, the Geological Survey estimated that using technology available at that time, 151 million barrels of oil could be recovered in the Bakken, said Brenda Pierce, a geologist and program coordinator for the agency's energy resources program. Pierce said she would not disclose the study's findings until Thursday. Asked whether the estimate would be an increase from the 1995 figure, she said, "There is industry in there and having success. There's your answer."

Julie LeFever, a geologist with the state Geological Survey in Grand Forks, has been studying the Bakken for more than two decades. She calls it an "unconventional resource."

The oil is trapped in microscopic pores of rock, and to capture it, most companies "fracture stimulate" horizontal wells by forcing pressurized fluid and sand to break pores in the rock and prop them open to recover oil. "It's not something you would see in most oil formations," LeFever said. With technology, she said, "the success rates are going up, but we're not all the way there yet."

She said estimates of the total amount of oil in the Bakken Formation have varied wildly over the years, from 10 billion barrels to 500 billion barrels. The higher estimate was done by Leigh Price, a USGS geologist who died in 2000 before his study was published.

RedOrbit also has a report - "Research on Bakken Formation's Oil Reserves Nearly Completed".

The U.S. Geological Survey is nearing completion of a research project that will attempt to quantify how much oil is contained in the Bakken shales formation and how much of it is recoverable. The study is expected to be completed by late April, according to Sen. Byron Dorgan, D-N.D., who, along with other state officials, pushed the federal agency to finish the research started by scientist Leigh Price.

Price estimated the Bakken formation may hold as many as 900 billion barrels of oil. But Price died in 2000 before the study could be published or peer reviewed. Other estimates of the Bakken formation's oil reserves have pegged the number at closer to 200 billion or 300 billion barrels.

Dorgan said Thursday during a stop in Grand Forks that completing the survey is important to North Dakota. The Bakken formation stretches across western and central North Dakota, eastern Montana, southern Saskatchewan and part of northwestern South Dakota. "I think it's going to show a very substantial recoverable reserve of oil," Dorgan said. "It will be important as a signal to the rest of the world what we have here."

Dorgan said the U.S. Geological Survey began work on finishing Price's work about a year and a half ago. He said he is optimistic that improvements in technology will lead to a substantial increase in how much of the oil in the formation will be able to be recovered. Dorgan said the study's findings will only increase the oil boom that the western part of the state currently is experiencing. "The oil boom is real and it's going to be real significant" Dorgan said.

Salon reports that (unsurprisngly) some demented culture warriors who view peak oil as a part of some sort of ideological battle (along with everything else) are crowing that this means the end of peak oil (which is nonsense of course - it just potentially changes the peak date and shape of the curve - much like the 220 billion extra barrels of oil under Iraq that some peak oil models ignore) - North Dakota -- the next Saudi Arabia.

The catalyst for this dismissal of peak oil anxieties? News of the imminent release of a federal report estimating the recoverable oil in the Bakken shale formation, a geological structure that spreads across North Dakota, Montana and parts of Canada.

Guesses as to the total amount of oil in the Bakken shale formation range from 10 billion barrels to an eye-opening 500 billion. Estimates of the amount of commercially feasible recoverable oil from Bakken are equally across the board, from 1 percent to 50 percent.

If 50 percent of 500 billion barrels of oil could be recovered in a reasonably short time frame, that might make a difference to the dynamics of global oil supply and demand. But such a prospect is unlikely. Shale oil is defined as sedimentary rock from which liquid hydrocarbons can be extracted. But it is not easy, and it is not cheap (and let's not even think of how environmentally catastrophic it is to pulverize mountains of rocks to get barrels of oil).

No question: Rising oil prices and technological progress will make it cost-effective to extract some of Bakken's shale oil and get it to market. But will that flow fundamentally challenge the peak oil thesis? From this corner, the hope seems like a stretch. The world is running low on cheap, easy-to-recover oil, of that there is no doubt. The possibility that the supply of expensive, hard-to-recover oil will keep pace with growing global demand appears dim.

The Salon article also points to a blog devoted to the Bakken.

Some considerably more excited commentary can be found at the Canada Free Press (accompanied with a very hefty dose of global warming skepticism) and there is a discussion at Slashdot as well.