shale oil – Page 16 – Peak Oil Barrel

Bakken Sweet Spots are Petering Out

11/22/201411/23/2014 Ron Patterson 420 Comments

The Bakken, as well as other shale oil areas, is not one homogeneous area where equal amounts of can be found. David Hughes in DRILLING DEEPER puts it this way, though here he is talking about gas wells, the same applies to oil wells:

All shale gas plays invariably have “core” areas or “sweet spots”, where individual well production is highest and hence the economics are best. Sweet spots are targeted and drilled off early in a play’s lifecycle, leaving lesser quality rock to be drilled as the play matures (requiring higher gas prices to be economic); thus the number of wells required to offset field decline inevitably increases with time.

However the Bakken, at least through the September North Dakota Industrial Commission production report, has given no real indication that the Bakken is even close to peaking. But a closer look at the data makes me believe that is all about to change.

The NDIC issues a Daily Activity Report where they list permits issued as well as wells completed and wells released from the tight hole confidential list. These reports usually, but not always, also give the number of barrels of oil per day and barrels of water per day for the first 24 hours of production. I have gone through every day, back to November 1st, 2013 and collected the data on every well listed that gives production numbers and copied that data to Excel. In that one year and three weeks I have gathered the data form every one of the 2,171 wells that give production numbers. Sorting these wells by well number, which is the original permit number, gives some startling results.

To smooth the chart I created a 200 well average of barrels per day per well. The first point on the chart is therefore the average to the 200th well, #23890 and the last point is the 200 well average to the 2171st well, #28971. As you can see there has been a continuous, though erratic, decline in first 24 hour production as the well numbers increase.

Breaking this down according to well numbers we see production peaked with the 2400s and have steady decline since. Every group of well numbers do not contain the same number of wells.
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The EIA’s Petroleum Supply Monthly

09/29/201410/01/2014 Ron Patterson 297 Comments

The EIA has just published their Petroleum Supply Monthly with US production, and other data, for July 2014. US C+C production fell by 3,000 barrels per day in July.

After a big leap in April things have slowed down considerably in the last three months. US production in July was 8,537,000 barrels per day

This is US production since 1920. We are just over 1.5 million barrels per day below the monthly high of 10,044,000 barrels per day of in November 1970.
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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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Global and Russian Energy Outlook to 2040

08/14/201408/14/2014 Ron Patterson 78 Comments

Like BP, OPEC, the EIA and the IEA Russia also publishes an annual energy outlook. It is called the Global and Russian Energy Outlook to 2040. It is published by The Energy Research Institute of The Russian Academy of Sciences and The Analytical Center for The Government of The Russian Federation. I have no idea who these guys are but their titles sound impressive and they seem to be Russian think tanks funded by the Russian Government. But that is just an assumption of mine.

It is a very large 175 page PDF file that appears to be very scholarly and well researched. However they appear to be very optimistic in their prediction of the future oil supply out to 2040. In one scenario they are not optimistic at all for coal production however.

The report has three scenarios, the Baseline Scenario where business as usual continues until 2040. The New Producers Scenario where oil prices collapse due to overproduction and The Other Asia Scenario which is based on peak coal and the effect this will have on China and India. In that scenario they assume China coal production will peak within the next ten years. The Baseline Scenario assumes adequate supplies of coal will be available however. Only in the Other Asian Scenario do they figure in peak coal. All three scenarios assume plenty of oil will be available through 2040.

Obviously they don’t see any peak in oil production out to 2040, only growth. However they have coal and gas growing even more. And they seem to be very optimistic about “other” renewables. I don’t know exactly what that might be.

And here is their take with an oil price overlay. It appears they think, because production increases right along with demand, that the oil prices will remain flat.

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