Peak Oil Update, 10x increase in US reserves

Russ Steele

We have heard a lot about the decline of oil reserves, which are estimates based on current technologies. With new technologies and higher prices, new reserves come on line. Consider this from the Next Energy News

America is sitting on top of a super massive 200 billion barrel Oil Field that could potentially make America Energy Independent and until now has largely gone unnoticed. Thanks to new technology the Bakken Formation in North Dakota could boost America’s Oil reserves by an incredible 10 times, giving western economies the trump card against OPEC’s short squeeze on oil supply and making Iranian and Venezuelan threats of disrupted supply irrelevant.

In the next 30 days the USGS (U.S. Geological Survey) will release a new report giving an accurate resource assessment of the Bakken Oil Formation that covers North Dakota and portions of South Dakota and Montana. With new horizontal drilling technology it is believed that from 175 to 500 billion barrels of recoverable oil are held in this 200,000 square mile reserve that was initially discovered in 1951. The USGS did an initial study back in 1999 that estimated 400 billion recoverable barrels were present but with prices bottoming out at $10 a barrel back then the report was dismissed because of the higher cost of horizontal drilling techniques that would be needed, estimated at $20-$40 a barrel.

When we were in Canada several years ago, there was extensive deep exploration going on just across the Montana and North Dakota border. This exploration was focused on the deep oil under under the shallow producing Canadian oil fields. There could be even more oil just North of the border, we will have to wait for the report.

UPDATE:  Here is an article in Business Week.

Comments

[Papertiger]

Proven oil reserves by country (as of 2006) - just for easy camparison.
Saudi reserves are 260 billion barrels, so we are definitely talking about world altering amounts of oil in North Dakota.

Just an aside - A cousin of mine is working oil fields in Montana.

[russ]

Tiger,

I worked in the Wyoming oil and gas fields in the late 50s. Those fields continue to expand, going far beyond those initial finds around Big Piney. I am now waiting for the other shoe to drop, why we cannot drill for these new oil reserves.

[Papertiger]

Hey Russ -- Shhh - don't give the donks any ideas.

[Papertiger]

Russ

You got an indirect Instapundit link. Check this out. Black Gold. North Dakota Tea.

So far no link, but when you click over to Power & Control's North Dakota Discovery.
Bingo.
Linked back here.
How do you like that?
Should we give Rush Limbaugh a hat tip?

[russ]

Tiger,

Rush is on vacation for a few days. I am pleased that Glenn and I stumble across the same stories and think they are important enough to post. It would be nice to get some Instapudit traffic and recognition.

[Papertiger]

I think Instapundit is suffering from the "too good to be true" syndrome, when he scoffs at the 200 bbl figure.

There's some good detail on the Bakken formation in the comments of Power & Control.
A Saudi Arabia of oil under Saskatchewan, North Dakota... - good maps of the deposit in that link.

Petrobank gives a good description of how the oil is harvested. Also the amount looks to be firming up at 413 billion barrels of oil in the whole combined America/Canada Bakken.
Would Petrobank be buying up all that land if it weren't real?
I don't think so.

[Papertiger]

Glenn was probably doing you and me a favor by not linking directly. Instalanche tends to knock some servers down with excess traffic as you can see from this story about Joe Lieberman's campaign blog.
He was just being considerate.

BTW - my boy at KFBK has been intensely resistant to the steady stream of links I have sent regarding the dodgy science of AGW. His position has always been not concerned with a warming world, as much as being determined to move in a direction where the USA can tell the Saudi's where to stick their oil.
This Bakken reserve provides just this sort of leverage.
I think I'll try out this article of yours on him. Chances are it will rock his boat fully over to our way of thinking on the AGW.

[Papertiger]

Bakken oil field survey 3.65 bbl oil. Ugg.
I'm beginning to get the feeling Glenn Reynolds is smarter then me.
heh.

[russ]

Tiger,

I am wondering if that is the US side of the field, or the whole formation. I have not had time to do any research. When we were in Canada two years ago, there was a lot of oil exploration going on just across the border.

Russ

[Brian wang]

The USGS estimate is just for the US side. Plus the estimate is only for current technology. From 1995 to now the USGS estimate went up 15 times. There is a lot of motivation (trillions of dollars for people to figure out how to get more than 1% out) The Bakken shale around light crude sandwich seems a better target than just Shale in Colorado. Over the next 5 years refineries and pipelines have to be put into N Dakota and Montana to get even the good daily rates of 3.65 billion barrels of oil out.

The USA will get more of a boost this year from the Thunder Horse deep sea rig (250,000 b/d) from the Gulf of Mexico.

[russ]

Brian,

Thanks for the update. I have not had time to look up the latest numbers.