Oil prices fell ahead of…
Oil prices fell on Wednesday…
The prolific Bakken shale formation has hit a major milestone, according to data from North Dakota and Montana. Drillers in the formation have now pumped out more than one billion barrels of oil. North Dakota has accounted for 852 million barrels of oil produced so far, with Montana having extracted 151 million barrels.
The production of the Bakken has happened very rapidly, with two-thirds of the one billion barrels produced in the last three years. North Dakota is closing in on the one-million-barrel per day mark, enough to make it the second largest producing state in the country after only Texas.
Some energy analysts think that the shale revolution in places like the Bakken could be shorter than many believe because the average shale well in the formation experiences a rapid decline rate after an initial burst of production. At the very least, growth could slow.
Related Article: Shale Revolution Spreads to the South
But so far, that has not come to pass as drilling rigs continue to improve efficiency. The latest Drilling Productivity Report from the EIA notes that the average rig drilling in the Bakken was producing 7 more barrels per day in the month of March compared to February, an indication that producers are constantly learning and improving. Rig counts have stagnated, but production continues to climb. And even as some older wells deplete, new wells brought a net gain to North Dakota’s oil production in March – adding an additional 21,000 barrels per day to the state’s output.
State prognosticators see growth for years to come. In a presentation last fall, the director of North Dakota’s Mineral Resources Department estimated that the state could be producing 1.6 million barrels per day by 2017. Moreover, the state forecasts err on the conservative side because they are used to project revenue for state budgets.
By James Burgess of OIlprice.com
James Burgess studied Business Management at the University of Nottingham. He has worked in property development, chartered surveying, marketing, law, and accounts. He has also…