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Bakken Shale Play - Realities of Development

For many of you who own minerals in the Bakken Shale, you might be asking why the drilling process is moving at a slow pace while thousands of "proven" production acreage has been untapped and awaits drilling.  Here are some facts which has effected this area since the discovery of massive oil reserves in regards to this formation.  First, the lack of sufficient drilling rigs in the area in proportion to the number of acres to be drilled.  Currently, 160 plus rigs are active in the North Dakota area while few exists in the mostly untapped areas of Montana.  This rig count has expanded over the last several months due partly to companies moving their operations from gas to oil.  Samson Oil and Gas just recently sold their Green River Basin gas assets to a group of private investors in order to focus on the Bakken and Niobrara plays.  Second, there is a lack of frac crews in this area which has resulted in a backlog of wells waiting for frac jobs.  This seems to be a growing problem which is resulting in the completion of wells.  Third, a lack of water in the area due to heavy demands in the drilling process. Currently, state and industry officials are waiting for federal permission to tap the Missouri River or risk hitting the ceiling on how much oil they can produce.  Record levels of drilling activity in this area has contributed to this problem over the past serveral months.  Currently, it has been reported that 7 million barrels of water is available daily and much more is needed to keep pace with this growing drilling activity.  In conclusion, in order to maintain current drilling operations at a reasonable pace , these problems will have to be addressed along with the transportation matters in regards to the minerals.

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Comment by charles s mallory on January 14, 2013 at 12:01pm

Erim:

Hope it provides the info you need.

Comment by Erim Foster on January 14, 2013 at 11:40am

Thanks for your response, Charles. I'll take a look at Halliburton and Schlumberger. Sounds like a good post for my blog, the whole water recycling issue.

Comment by charles s mallory on January 12, 2013 at 4:26pm

Erim Foster:
In regards to your question regarding the recycling of water, Halliburton Corp. tends to be somewhat the leader in this type technology.  Their registered process is the "Clean Wave System".  If you go to the Halliburton website, this Clean Wave System is discussed in detail.  Schlumberger LTD is also involved in the recyle process but I think Halliburton has the pioneer status for this process.  You are correct in that millions, possibly billions of dollars will be saved by the recycling of this wastewater.  This will be a key component in the future of drilling as all operators are seeking ways to save money in this highly expensive business.  Hope this helps.

Comment by Erim Foster on January 12, 2013 at 4:01pm

How are things vis-a-vis water at this point, Charles? Do you know happen to know what percentage of the water used for fracking is recycled? It seems like that's going to be a key issue going forward. They need to get that gas fracking thing worked out.

Comment by Tom McLarnan on February 2, 2012 at 9:45pm
Wondering what impact the lack of snowfall in ND will have on availability of water for fracting. Any thoughts?
Comment by Lori B on January 19, 2012 at 5:03pm

I agree with this.  We have to think like the business owners who try to lease our minerals, and spell out in our contracts when and why or if a well can by shut in, but not produce.  

 

"The monopolistic greed of the companies that acquired far more acreage then they can possibly develop is causing great harm to our state and to mineral owners whose interests they have diluted to a miniscule fraction of what they are worth.  "

Comment by charles s mallory on October 14, 2011 at 5:48am

Dennis:

Thanks for the update.  I am ready for some serious drilling to beging in Eastern Montana and 2012 may be the start of Montana's drilling (somewhat like ND).  If rigs are migrating to the area, this is a good sign of things to come.  To date, I still don't see many new permits being sought for this Eastern MT area.  Maybe things are about to change.

Comment by Dennis Broadbrooks on October 14, 2011 at 2:56am

The keystone pipeline is about to built across the US from Canada to Texas. Here in Phillips County, Montana, Keystone is continuing to acquire easement from landower for the pipeline. Word around here is drilling has started for Bakken oil over one county to the east in Valley County. A lot of activity in Roosevelt County also. Go west young drilling man! Have also heard that drill rig after drill rig are pulling out of Texas for the Bakken Play. This might answer why little or no activity in the Barnett shale counties. High priced oil and low priced natural gas.

Dennis

Comment by charles s mallory on September 11, 2011 at 5:39pm

Wes:

All of these things impact their #1 activity which is drilling and completing wells along with transporting the oil.  I agree with you in that snowfall is minimal and the winter will be mild in order to play catch up on the time missed during last winter and the flooding situation. 

Comment by Wes Luke on September 11, 2011 at 5:29pm

Charles,

That part of the conutry seems plagued by several things, mostly interactive with each other. When they have a lot of snow like last year it's not a blessing when the temps go above freezing. After the snows, as experienced this year they can't drill a lot of places because of floods. I guess we can only pray for very little snow making for a great Spring drilling.

Yours,

Wes

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