Submitted by Arthur Berman via OilPrice.com,
Only 1 percent of the Bakken Play area is commercial at current oil prices based on my analysis that follows.
Only 4 percent of horizontal wells drilled since 2000 meet the EUR (estimated ultimate recovery) threshold needed to break even at current oil prices, drilling and completion, and operating costs.
The leading producing companies evaluated in this study are losing $11 to $38 on each barrel of oil that they produce, the very definition of waste.
Although NYMEX prices are about $46 per barrel, realized wellhead prices in the Bakken are only $30 per barrel according to the North Dakota Department of Mineral Resources. At that price, approximately 125,000 acres of the drilled play area of 10,500,000 acres is commercial (green areas in Figure 1).
Figure 1. Bakken Shale Play commercial area map at $30 per barrel wellhead price. Contours are in barrels of oil estimated ultimate recovery. Contour interval = 200,000 barrels of oil. Source: Drilling Info, North Dakota Department of Natural Resources & Labyrinth Consulting Services, Inc.
The break-even per-well EUR is 700,000 barrels at a $30 oil price. The underlying economic assumptions are shown in Table 1.
Table 1. Economic assumptions and outcomes used to determine the Bakken $30 per barrel commercial area shown in Figure 1. Source: Company presentations and Labyrinth Consulting Services, Inc.
There has been much debate about the break-even price for tight oil plays in the U.S. This discussion is largely meaningless because there is no single break-even price for any play.
I had a short software contract in Fargo, ND.
That state is a fuckin’ pit. The state tree is the telephone pole.
“This discussion is largely meaningless because there is no single break-even price for any play.”
—-last sentence in the article
Yep, that says it all. Once again, anti-fracker Admin and his analysis of horizontal drilling in the U.S. crashes and burns.
@ Dutchman – ND may be a pit, but not the beautiful Theodore Roosevelt National Park in southwestern ND. Oh, give me a home, where the buffalo roam (right next to your car as you drive through the park).
@Dutch: That’s pretty funny.
North Dakota, the only state of the contiguous 48 that I never visited. No regrets. Read “Giants in the Earth” and weep.
Shale oil seemed like a boondoggle from the get-go and it seems more so now.
“Only 1 percent of the Bakken Play area is commercial at current oil prices”
Yes…the dude stealing it and reselling it…that’s about it.
Dutchman says: That state is a fuckin’ pit. The state tree is the telephone pole.
LMAO, well said! In my past life I was a Pipeline Welder I worked in Wiliston ND There are no churches cause God doesn’t even stop by
Think fracking sucks? Explain this, maff geniuses. 2012 trade deficit with saudi arabia, 38 billion. 2013 trade deficit with saudi arabia, 32 billion. 2014 trade deficit with saudi arabia, 28 billion. Projected 2015 trade deficit with saudi arabia, 3.5 billion. We’re doomed
starfcker the maff genius.
thank you sir. May I have another?
@ starfcker I do not think that trade deficits matter when the privately owned central banks create so called deficits out of thin air? Tangibles , Tangibles etc etc .
all of the privately owned banks are moving towards a particular goal , stop looking at the trees and start looking at the forrest .