Mature VS Immature

General Mineral Rights Discussion
1

Very novice questions I'm curious about, if someone in the know is willing to share their knowledge, I would love to learn.

After looking at some data and mappage of the Bakken, in ND and MT; I found one map that showed the outline of the Mature area and the Immature area.

What defines Mature VS Immature, and what happens in the Immature area if it's drilled? How were they able to know the lines they've drawn are accurate? That would be a lot of testing or have they just generalized the lines they believe it forms?

Does it mean all formations are immature in the zones that are outside the Mature area, or only the Bakken formation? Also, if it's immature, how long until it's classified as Mature? Are we talking decades or centuries for the mature stage?

If less than productive numbers are found among mapped immature area's, why would a company bother with leasing the acreage there?

2

Snues, you'll need a geologist to provide a proper answer but here is a poor analogy for you... Think of making wine. They press grapes (base material), bottle and let it ferment (creating pressure), and then let it age (time). After the proper amount of time fermenting under pressure it can become wine. Too little time and it's not ready yet (immature). Too much time and it's gone "off".

For oil the base material is often described in terms of Total Organic Content (TOC) which has been buried deep under ground for millions of years. The combination of pressure, heat, and time determines how mature the oil is. Oil within a range of maturities is produced and can be utilized. Though much of it will not be useful if it's still immature, or if it's gone too long and in effect is 'overcooked'.

The maps you've seen are showing maturity of the Bakken formation. Though I've noticed the map may not always correspond to facts on the ground. Some of the area shown as "immature" in Mountrail County has had big producing wells. Though as you move east of that it quickly falls off into no production at all. So while in general the map acurately shows the facts, I suspect it's an extrapolation from partial data so it's not exact. The leasing, and the drilling, outside "mature" areas are attempts to establish just where the true line exists. Further as noted above, a range of maturities can be utilized so there is not a precise maturity needed.

3

Thanks Eastern MT, for your analogy of my questions. It did explain a lot, and I appreciate the layman's terms. Most times I read through material on geological information and it's information that would need to be interpretted by a geologist in most cases. I do OK with Map's and Graph's, to understand things.

Last summer they announced in newspapers and possibly on the NDIC that original data and reports of the Bakken might not be accurate in their findings, and that new research would begin October 2011. I'm guessing the tests or documentation they'll do, will take some time, but I haven't heard anything further on the data they have found.

Do you have any idea of the timeline it takes to do the research they're seeking? They didn't specifically explain what it would involve. My guess would be that the number of barrels of oil that they've claimed the Bakken holds, will be even more than they originally thought. If thats the case, would the "outlines" of where the Bakken acreage is defined, change?

4

I expect the "outline" of where the Bakken formation is will not change. Though I suspect the "outline" of where the productive portions of the Bakken formation is will change. Simply put the maps we've all seen were based on projections from several hundred wells scattered over multiple counties drilled in the 1950's, 1960's and 1970's. This provided valid, yet incomplete, data on the Bakken within the basin as a whole.

Today they have the benefit of thousands of new wells drilled during the past decade. Data from all these new cores, and actual production results, does refine their understanding of what is there. This is helping locate exactly where the boundary on the mature/immature areas may lie. There is already a fair understanding of roughly where the line is. Though additional drilling is needed. Some of those outlying areas have yet to be fully explored.

So while I'm unaware of the specific research you mentioned I'd guess it will be 2015 or so before they can definitively say where the true eastern and southern boundaries are. The western boundary will take longer to define. Even then, how do you define the "boundary"? Is it the line where there is absolutely no oil, or where the wells transition from those which produce 200 bbls per day to those wells which only produce 20 bbls per day? In other words, the physical line and the economic line may not be the same.

5

Here is one post from last May, about the new study. It will be interesting to see the data they find with this new study.

USGS to perform Bakken, 3 Forks study

Associated Press | Posted: Thursday, May 19, 2011 11:56 pm

The U.S. Geological Survey says it will perform a new assessment of the Bakken and Three Forks oil formations in North Dakota and Montana.

Secretary of the Interior Ken Salazar made the announcement Thursday. He says there's "significant new geological information" and new oil drilling technologies since the government did its last study in 2008.

That assessment estimated up to 4.3 billion barrels of crude could be recovered using technology at that time. The agency called it the largest continuous oil accumulation it has ever assessed.

North Dakota politicians have called for the new study, saying it would help spur investment in the state's oil patch.

The USGS says the two-year study will begin in October.

6

Thanks for the post. The study referred to is geared more towards the "big picture" rather than pertaining to individual mineral owners. Currently the USGS pegs this at 4.3 billion bbls, previously they estimated the Bakken might have about 400 million bbls.

Harold Hamm CEO of Continental Resources has repeatedly stated they believe the true number is about 20 billion bbls. Others suggest even Hamm might be estimating low. So the new USGS study will no doubt increase their estimate above 4.3 billion yet it doesn't really affect you or I. I'm more interested in how EOG, OXY, or Whiting does when drilling a well on or near minerals I own.

7

LOL; you're right, that whatever the billions of oil there is or isn't won't effect you or I.

As for being more interested in what they're doing on the minerals you own, is sort of the same reasons I was hoping this new testing was going to show that new boundries have been made, which would incorporate counties further south, and help out those of us wishful thinkers in Slope County. As the maps now show, the Bakken zone barely touches inside Slope County on the northeast.

On the flipside of that, I have seen mineral owners within McKenzie or Williams not get good well production; so its still a guessing game. In the meanwhile, its been a fun and interesting subject to get to know more about.

After re-reading that post of the new study, I found the answer at the bottom of message that say's it'll be a 2 year study.

8

Snues,

Don't shoot the messenger, but... In my completely unqualified opinion, if your minerals are in Slope County you won't ever see Bakken drilling. However, there remains a real possibility they may chase other formations there in the future. Currently the Bakken/Three Forks is getting all their attention but that won't always be the case.

The west end of Slope Co already has oil production (as does Bowman Co to the south of Slope). To the north of Slope, Whiting is currently fishing to see how far south of Interstate 94 the productive portion of the Three Forks formation may extend. They also drilled some new Red River wells near Beach, ND. Then there is talk that the Lodgepole and/or Tyler formations might become future plays.

While you may never be a 'bakken baby', you are still in the game. It's hard to forecast where this could go. Heck twenty years ago you might have bought minerals for $100 per acre in what became the heart of the Bakken play. So there is no way to know what your minerals may bring tomorrow. The USGS may determine you're sitting on top of the motherlode of the next great play. :)

9

Half a motherlode would work too! Last year when interest picked up for leasing in Slope County, I became hopeful they might actually begin some active drilling; and once they found a few good wells, the rest of the companies would show interest too.

Now 2012 happens, and it's like Slope County becomes a big goose egg once again. The February State Auction results for Slope County were disheartening, especially in comparison to what the Auction brought in August 2011.

All in good time, and having read that only about 15% of the wells have been drilled in North Dakota, means I can hope to be part of the 85% that remains to be drilled. Patients is a virtue, I must practice. :)

10

I found this article and decided to share it here.

Mercer County not ‘mature enough’ for Bakken

LAUREN DONOVAN BismarckTribune.com | Posted: Tuesday, March 13, 2012

BEULAH — Hope for striking oil in Mercer County depends on how mature it is.

The Coal Country county is on the far fringe of the Bakken formations that are thermally mature — properly cooked, in other words — and readily produce oil.

And “fringe” in this case may mean no more than 20 miles or so bordering Dunn County, where one Bakken well was plugged and abandoned two years ago. Another one drilled roughly at the same time was first drilled into the Bakken with no results and then pulled back up to the Lodgepole formation. Today, that well produces 10 barrels of oil a day and 50 barrels of water in the same time.

From that perspective, the analysis for Mercer County presented Monday night by State Geologist Ed Murphy was not dazzling.

Murphy spoke to about 40 people, many of them rural folks and members of the Mercer County Farm Bureau, which sponsored the presentation.

There might be hope for oil development, even though the county is not in the Bakken hot spot, he said. Outside the thermally mature area of the Bakken, which includes most of Mercer County and beyond to the Missouri River, is an area called an “expulsion area,” he said.

Murphy said the theory is that Bakken oil is pushed out beyond its mature boundary and that outlier area has shown fairly good production in Saskatchewan on the northern reach of the Bakken.

It’s possible that geologists’ calculations are wrong and the expulsion “is really part of the Bakken,” Murphy said.

He said the Tyler formation doesn’t look promising for the county either, like it does for counties in a region south of Dickinson, “unless the oil pushed in from somewhere else.”

He said the county’s best oil bet could be in formations deeper than the Bakken, called the Winnipeg and Red River groups, somewhere around 12,000 feet deep.

Murphy said it’s all about the oil window and when it’s not in the Bakken or formations above it, the best place to look is below it.

“We’re using the best science available. I thought about this coming here and I don’t want to dash anybody’s hope. These are maps we’ve had out there since 2008 and companies are well aware,” Murphy said.

The companies are focused on the thermally mature area, but the expulsion area might be a way for some companies to get into the oil patch out on the edge with much cheaper leases, he said.

Figures from the state Department of Mineral Resources showed that 225 rigs could drill another 4,500 wells in two years to finish the first phase of Bakken development when leases are secured by at least one well. Murphy said it’ll take another 16 years to drill another 27,500 wells to fully develop the spacing units.

The first phase will provide up to 27,000 jobs in the oil industry and another 10,000 jobs in infrastructure, with 60,000 jobs at its peak, phasing into approximately 35,000 permanent jobs.