A few recent stories about North Dakota’s energy industry caught my eye. The Forum ran an article that North Dakota is on track to produce 2 million barrels of oil per day by 2030. Two million barrels a day, where have I heard that before? That’s right, when Gov. Doug Burgum challenged the state’s energy industry to reach two million barrels a day at a Bakken conference in 2017.
Another report from late last month said that the U.S. Geological Survey is working on updating its assessment of Bakken oil and gas reserves. The survey was last done in 2013. What has happened since 2013? A lot.
In late 2014 oil prices plummeted, aided by actions of the Organization of Petroleum Exporting Countries (OPEC). Domestic energy producers, led in large part by the Bakken, reacted quickly to cut expenses and used advancements in technology to survive as prices dropped and stayed low. Those actions, led by independent oil producers, set the stage for recovery in the Bakken and elsewhere. To the point that the talk of 2 million barrels a day is no longer a pipe dream.
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Another recent proves the point. Continental Resources gave its first quarterly report for 2019 and the news was very good. The biggest positive I saw in that report were the results from several "step-out" wells in the Bakken. While recovering from the drop in oil prices, most producers in the Bakken focused on the "core" areas, generally four counties that lie north and south of Lake Sakakawea: McKenzie, Dunn, Mountrail and Williams. This left a question about the practical breadth of the Bakken.
Continental wanted to test areas outside of the core to see how those areas can produce with constantly improving drilling and completion methods. It drilled three oil wells far outside the core area, ranging from 15 to 60 miles from the core production area. The results from these step-out wells was 80% to 110% better than older wells in those areas.
Whiting Petroleum and other North Dakota operators are seeing similar jumps in production as additional wells are placed near existing wells. These companies continue to increase the percentage of oil recovered from each well.
Also as reported, Denbury Resources is investing serious money in enhanced recovery techniques using CO2 and expecting big returns in the next 2-3 years. The Energy and Environmental Research Center in Grand Forks is studying the use of CO2 to boost recovery and sharing that information with producers in an effort to push efficiency.
Given these results, we can expect a significant increase in Bakken oil and gas reserves when the U.S. Geological Survey is revised later this year. The Bakken is going to produce oil and gas for generations to come.
Our energy industry faces headwinds. As I write this, Washington Gov. Jay Inslee is expected to sign a bill supported by environmental activists that will cut off markets on the west coast for Bakken oil. And much needed pipelines are a challenge. But, if the last three years are any indication, I am betting on the Bakken.
Grande represented the 41st District in the N.D. Legislature from 1996 to 2014. She is a wife, mom, grandma, lover of life and Jesus. Opinions are solely her own. Email her at firstname.lastname@example.org