Light Tight Oil – Page 24 – Peak Oil Barrel

Bakken and North Dakota Production Report

12/12/201412/12/2014 Ron Patterson 441 Comments

The North Dakota Industrial Commission just published their Bakken Monthly Oil Production Statistics and also their ND Monthly Oil Production Statistics.

Bakken production was down 1,598 barrels per day to 1,118,010 bpd. All North Dakota production was down 4,054 bpd to 1,182,174 bpd.

From the Director’s Cut, bold mine:

The drilling rig count dropped 2 from September to October, an additional 3 from October to November, and has since fallen 5 more from November to today. The number of well completions decreased from 193(final) in September to 134(preliminary) in October. Three significant forces are driving the slow-down: oil price, flaring reduction, and oil conditioning. Several operators have reported postponing completion work to achieve the NDIC gas capture goals. There were no major precipitation events, but there were 9 days with wind speeds in excess of 35 mph (too high for completion work).

The drillers outpaced completion crews in October. At the end of October there were about 650 wells waiting on completion services, an increase of 40.

Crude oil take away capacity is expected to remain adequate as long as rail deliveries to coastal refineries keep growing.

Rig count in the Williston Basin is set to fall rapidly during the first quarter of 2015. Utilization rate for rigs capable of 20,000+ feet is currently about 90%, and for shallow well rigs (7,000 feet or less) about 60%.

Sep rig count 193
Oct rig count 191
Nov rig count 188
Today’s rig count is 183

Sep Sweet Crude Price = $74.85/barrel
Oct Sweet Crude Price = $68.94/barrel
Nov Sweet Crude Price = $60.61/barrel
Today Sweet Crude Price = $41.75/barrel (lowest since March 2009)

I just checked Rig Count. It now stands at 181 but one of them is drilling a salt water disposal well. So they have 180 rigs drilling for oil right now.

Bakken wells producing increased by 118 to 8,602 while North Dakota wells producing increased by 92 to 11,507. Since Bakken wells are included in the North Dakota count this means at least 26 wells outside the Bakken had to be shut down.
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More on Bakken Production, Choke Theory

11/26/201411/27/2014 Ron Patterson 308 Comments

The US Petroleum Supply Monthly just came out with production data for every state and territory. US supply was up 168,000 bpd to 8,864,000 bpd in September. The biggest gainers were North Dakota, up 53,000 bpd to 1,185,000 bpd and Alaska up 79,000 to 477,000 bpd. Alaska was way down in both July and August and are just recovering from that. There was only one big loser, New Mexico, down 18,000 bpd. Texas was up only 9,000 barrels per day which was surprising. The Gulf of Mexico was down 3,000 bpd.

The Choke theory and why I ain’t buying it.

North Dakota publishes a Daily Activity Report Index of all permits and other well activity in the Bakken as well as the rest of North Dakota. In this report is a list of all producing wells completed as well as wells released from confidential (tight hole) status. Wells usually stay on this list from a few days to a few months, but the average is only a few weeks.

I have collected this data from October 2013 to present and found some startling results. But some have said this data means nothing, that wells are usually choked off by the driller so therefore we can gain nothing from the data. But looking at the individual wells that just doesn’t make any sense. No, I agree that the driller chokes but that he would not gradually choke more according to increasing well number.

Below I have posted the first 24 hour data for all 122 wells reported by North Dakota for the first 25 days of November. The first 24 hour production ranges from over 3000 barrels of oil per day to a low of only 10 barrels of oil per day. Barrels of water range from a high of 6663 bwpd to a low of 48 bwpd. And the percent water cut ranges form a high of 94.15% water to a low of 12.75% water.

It just seems incredible to me to claim that these numbers are meaningless. Throughout all the almost 14 months of data I have gathered there are lots of very large producing wells and a lot of small producing wells. The point is as the well number increases the number of very large producing wells seems to decrease while the number of small producing wells seems to increase. And I just don’t believe this is due to the many drillers, after checking their well number, decides what size choke to apply.

Just below the list of all wells I have averaged the production according to well number. The sample however is not large enough to really mean a lot. The number of wells in the sample are: Below 26000, 11 wells – 26000s 35 wellw – 27000s 54 wells – 28000s 23 wells.
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More David Archibald on LTO plus Net Imports

09/24/201409/24/2014 Ron Patterson 286 Comments

David Archibald has recently revised his peak date for shale oil. The below was contained in a recent post I received from him:

Ron,

For what it is worth, just to let you know that I have recanted on my estimate of US LTO production.

This is from reading the presentations put out in September by the US independents. I started with the EOG presentation and then worked through the others that EOG referred to. If Hubbert-type analysis works for LTO, it may be too early to apply it.

The rig count for the Bakken etc may be down to flat but the fraccing units are pumping a lot more sand and the economics of fraccing have improved a lot over the last two years. That in turn means that the resource is larger at a given IRR cutoff. This is currently my best guess of the three major plays:

Others are appearing such as SCOOP in Oklahoma.

I tried to make the graph useful by putting in the cumulative production to 2035 so that people can mentally adjust it for what they think EUR might be. The Permian has a lot of NGLs and natural gas which means that the energy produced is about twice as large as the oil component. The reason I didn’t make the Permian as peaky as the Eagle Ford for example is that there at lot of stacked plays in the Permian. Once companies have got acreage and got one horizon working, they don’t have to be in a rush to develop the others.

The US LTO boom is worth about two to three years of conventional oil decline:

With further demand destruction, the US will become energy independent.
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Bakken and N.D. Update for July

09/12/201409/13/2014 Ron Patterson 182 Comments

North Dakota has released their Bakken and North Dakota production numbers for July.

Bakken production was up 19,456 bpd while all North Dakota production was up 18,134 barrels per day. This means that North Dakota production outside the Bakken fell by 1,322 bpd or a little over 2%.

Bakken wells producing increased by 195 to 8,065. North Dakota wells increased by the same amount to 10,952 so non-Bakken wells were unchanged at 2,860.

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Who’s Got Liquids? plus Further to the Bakken

08/29/201408/30/2014 Ron Patterson 192 Comments

This is another Guest Post by David Archibald

Who’s Got Liquids?

An article by Canadian consultant Mike Priaro in the 7th July, 2014 edition of Oil andGas Journal, “Grosmont carbonate formation increases Alberta’s bitumen reserves”, included the following tables:

Mr Priaro’s estimate of Canada’s recoverable bitumen is 818 billion barrels. Almost all of that is in Alberta. Combined with their coal resources, Alberta has the biggest fossil fuel resource on the planet. I have updated my estimate of what some of the major countries have in the way of fossil fuels in this table:

The highest value fuels are those that can be used as liquids in transport. High quality coal produces 2.2 barrels of liquids through a FT plant. In the following graphic I have used a factor of 2x to convert coal to its oil equivalent. Six thousand cubic feet of gas has the energy equivalent of one barrel of oil. Natural gas can be used directlyin some transport applications. Putting it through an FT plant to make diesel, for example, would lose at least 30% of its initial energy. Natural gas has traditionally traded at the oil price in the US and conceivably might return to close to that level in a tight market. So in the following graph, natural gas in TCF is divided by six to produce its oil equivalent in billions of barrels. This is the graph:

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