"Massive Oil Deposit Could Increase US reserves by 10x.
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.
It was not until 2007, when EOG Resources of Texas started a frenzy when they drilled a single well in Parshal N.D. that is expected to yield 700,000 barrels of oil that real excitement and money started to flow in North Dakota. Marathon Oil is investing $1.5 billion and drilling 300 new wells in what is expected to be one of the greatest booms in Oil discovery since Oil was discovered in Saudi Arabia in 1938.
The US imported about 14 million barrels of Oil per day in 2007 , which means US consumers sent about $340 Billion Dollars over seas building palaces in Dubai and propping up unfriendly regimes around the World, if 200 billion barrels of oil at $90 a barrel are recovered in the high plains the added wealth to the US economy would be $18 Trillion Dollars which would go a long way in stabilizing the US trade deficit and could cut the cost of oil in half in the long run."
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I tend to think oil is working its way to a major IT peak, which will be followed by a decent correction, then eventually a push to new LT peak. The IT peak should be very near, the LT peak maybe 5 years or so out. A couple things could contribute to the LT peak. One is economic armageddon, which I do not believe in. The other one is that oil patch investment will eventually catch up and pay off, and the oil patch will again out do themselves, for another period in time. I favor the latter, but that is just my opinion.
I believe M. King Hubbert was probably not only a good geophysicist but a great one. However I doubt in the validity of peak oil. The one thing Hubbert did not or could not include in his analysis was the effects of new technology. No one can be a good predictor of what new technology will and does bring to the table. W/r to oil and other related hydrocarbon discovery and production, the effects of new technology over the last 20 years have been profound.
The Bakken Oil Formation could even be quite a bit larger w/r to recoverable reserves than indicated herein, as it extends a good distance up into Canada as well. What remains to be seen however is how the 'recoverable' portion works out, and how fast industry can ramp it up.
It always has seemed rather odd to me that the ME contained such a great % of the worlds recoverable reserves. Maybe it tain't so, after all.
Chavez, are you keeping up with oil patch news? You should know that the Yankee oil patch always has a habit of making/producing new big finds. Don't overplay your hand, or it might get caught in a vice.
If the Bakken Formation is as massive as some projections indicate, and can eventually be produced in quantity, oil politics will undergo some major changes. Is not going to happen tomorrow, but slowly over the next 5 plus years. |
