[Moto]

http://energy.geothunder.com/2011/10/16/continuous-resources-vs-traditional-oil-fields/

Please provide comments on what additional information you would like to see provided in this series of posts.
As always feel free to criticize.

Thank you for your feedback.

[Pops]

Actually, Moto, we usually delete spam and a post with nothing but a link is spam.

If you are interested in contributing here then please do but if you simply want to promote your websites you'll need to go elsewhere.

[basil_hayden]

Plus, this guy's blog blows yours away!

http://milliondollarway.blogspot.com/p/about-this-site.html

[Moto]

Sorry I didn't get back earlier.

Plus, this guy's blog blows yours away!

Yeah, I know Bruce. (we cross paths on the web often) He probably has the single best Bakken resource in the world. I have yet to meet him in person, but I expect it will happen sooner or later.

If I was retired my sites would probably be better too.

The goal of my energy blog has nothing to do with the Bakken, but I do use it as a reference often because I know how to find all the data for the region.

Thank You for the warning regarding spam. I also run several web forums, and I typically delete anything that does not pertain to my site's content. This post is certainly borderline, but I will be a contributor to this site, and hopefully the post is something most of you find interesting.

Hits are nice, but I really would like critical feed back on what you all think about the content of the article. My target audience is like-minded people to those that occupy this forum.

All responses regarding the blog post should be on this forum. Partly to keep the traffic here and partly to save me time dealing comments I probably don't want on my site anyway.

basil_hayden If you were referencing my bakken site that was created because I don't like what google is doing to google groups. Ideally people will eventually migrate, but I don't know when that will start to happen or if it will.

[Pops]

Just post up the gist of your article with a link like any other article and everyone is happy.

[copious.abundance]

I actually thought the article was pretty good. Points like the one below are really good because you don't usually see them mentioned on places like this or TOD:

In fact continuous resources are often the source rock for many traditional fields. If not for continuous resources traditional traps would not have any hydrocarbons in them. A few percent of the oil and gas contained in continuous resource leaked out over long periods of time (millions of years) and accumulated in traps.

One other thing to note is that the oil in continuous resources (at least, shale source rocks, but definitely not continuous resources like the tar sands) tend to be of higher quality than conventional traps, because during the process of migrating to a trap oil tends to pick up lots of impurities. This isn't always the case, but it's often the case.

It might also be interesting to more fully describe the types of development the two kinds of resources will have.

A conventional trap like the East Texas oil field were developed with 30K wells. The field covers 140K acres (about 219 square miles). If that same field were developed today with more modern know-how the number of wells would certainly be less, but would still be a lot. Maybe 15-20K wells.

A continuous source rock like the Bakken covers about 200,000 square miles. According to this, the Bakken and related formations in the same area will be developed with anywhere from 20K to 40K or more wells over the next 30 years.

So, about the same number of wells have been/will be drilled in the two formations. They both contain about 5 billion barrels of recoverable oil, maybe more. The differences boil down to:

1A) A continuous resource needs more miles of pipe and other infrastructure to be developed, because it's spread out over a larger area.
1B) On the other hand, there is very little exploration risk in developing a continuous resource. Delineating a relatively small trap can be a hit-and-miss process, especially in the early stages, so a lot of dry wells get drilled. In a continuous resource, on the other hand, as long as you know the depth of the rock (which most everyone does by the time they start drilling the first wells, because most of these areas already have a history of conventional development), you are practically guaranteed to hit oil. There will be good spots and not-so-good spots, but at least they've all got at least *some* oil and/or gas.

2A) The oil in a conventional resource might be good quality, but it also might be poor quality.
2B) The oil in a continuous (source rock) resource is almost guaranteed to be high quality.

3A) The oil in a conventional resource flows without having to stimulate the rock.
3B) The oil in a continuous (source rock) resource needs fracture stimulation to free the trapped oil.

4A) Being spread over a smaller area, development of a conventional resource entails less mineral leasing.
4B) Being spread over a large area, development of a continuous resource entails lots of mineral leasing.

So, in a continuous resource you're gaining a lack of exploration risk and (more likely) low refining costs in exchange for higher development costs (land, infrastructure and fracturing).

[Moto]

Thank You OilFinder that is exactly what I wanted . I will probably put part two up tomorrow or Sunday which covers some of you points, but I will try to get all of your comments incorporated.

[kublikhan]

A few questions:
1. How low can the price of oil fall without seeing production shut-in at Bakken? I read in an article that growth will continue as long as oil stays above $60. And oil wells start getting shut in when oil falls below $50. But that article was from last year, not sure if any new developments have changed since then. Also I am not sure if that price is the Brent price or the heavily discounted Bakken price.

2. What pipeline projects are currently in the works to relieve the transportation bottleneck at Bakken? I read many of these pipeline projects are far from a sure thing and their future looks ambiguous. Instead, I read about an expansion in rail transportation facilities, hardly an ideal method of transporting oil.

[copious.abundance]

A few questions:
1. How low can the price of oil fall without seeing production shut-in at Bakken? I read in an article that growth will continue as long as oil stays above $60. And oil wells start getting shut in when oil falls below $50. But that article was from last year, not sure if any new developments have changed since then. Also I am not sure if that price is the Brent price or the heavily discounted Bakken price.

When the price of oil was crashing in late 08-early 09, I was reading some stuff which said there are "sweet spots" in the Bakken which are economical as low as $30/barrel, though to be sure the majority of the areas needed at least $50 and even $60 to be viable.

2. What pipeline projects are currently in the works to relieve the transportation bottleneck at Bakken? I read many of these pipeline projects are far from a sure thing and their future looks ambiguous. Instead, I read about an expansion in rail transportation facilities, hardly an ideal method of transporting oil.

As I posted here, there are a mixture of pipeline and rail projects under construction or planned over the next several years to transport Bakken oil. So it's not just rail.

[Moto]

Current break even price is $55 (see slide 4), but that keeps dropping. Their are problems getting the oil out, and there is currently a significant shortage of proppant world wide (solutions are on the horizon). The gap is closing on a lot of the input costs. Infrastructure problems in the Williston basin do add a measurable amount to Bakken development. The drilling companies are often directly or indirectly billed for infrastructure development, but at some point infrastructure will catch the demand caused by drilling (cities and counties are not willing to put much money in because they got burned in the 1980s). I have seen some projections of infrastructure catching up in about 2015, but I don't remember the source. Regardless the input costs should drop as development continues, and output revenue should rise as supply chains become better established. (both into and out of the state)

Sorry this is kind of a tangent topic.

[babystrangeloop]

You should use a comma here:

If not for continuous resources traditional traps would not have any hydrocarbons in them.

If not for continuous resources, traditional traps would not have any hydrocarbons in them.

Moto did put up a new version today but it's radically different from the first one. At least it

1. Came out on the Sunday that Moto's previous post said would be the day he would put out an update.
2. Uses the same title, Continuous Resources Vs Traditional Oil Fields with a "2" on the end of it.

But the content is so very different, mostly focused on fracking now.

Continuous Resources Vs Traditional Oil Fields 2
Moto / Geothunder Energy / October 23, 2011

... skip ...

Fracking Safe?
The answer is the same as driving a car or firing a gun. Yes. As long as it is done properly. As for the people who think it will poison the water supply of cities… They do not understand the process or geology in general. Most public cases blamed on hydraulic fracturing have nothing to do with fracking. The cases where natural gas ended up in someone water well is most often related to the drilling process. I.e. drilled through a gas pocket near the surface or the faulty casing. To most people, it does not matter how or what is causing the environmental problems as long as they have something to blame. The problem is that large numbers of people are seeking the wrong solution because they do not understand the problem. Leaky casing is a problem, but it is not likely to endanger a large water supply. Regardless, this post is not about fracking problems, so I will leave it at that. If you want to know more about fracking, please ask or check out the rest of my site.

... snip ...

Yeah, fracking's safe and radiation's safe and GMOs are safe and "Science (Truth) = Technology".

[Moto]

Thanks babystrangeloop. I will probably revise both posts some based on OilFinder's comments. I don't know if I will have time to get to the third post this week, but I will try. If I miss it there may not be time to get it done for the next month or so...

[Serial_Worrier]

Think about the environmental wreckage of shale oil production. It's immoral to future generations as well as the tar sands that has destroyed large swathes of arboreal Canadian forest.

[Bruce_S]

Think about the environmental wreckage of shale oil production. It's immoral to future generations as well as the tar sands that has destroyed large swathes of arboreal Canadian forest.

"Large swaths" implies, like, BUNCHES! I don't think it is any worse than other industrial sized operations, be it the Anaconda mine, deforestation for agriculture in Brazil, strip and mountaintop removal mining in the eastern US, or many of the other things humans have screwed up in their ascent to dominate species on the planet. But "large swaths", please, all of these things together are probably analogous to blaming the death of the oceans on beach goers. In Florida. Under the age of 12. Who wear glasses.

[copious.abundance]

Think about the environmental wreckage of shale oil production. It's immoral to future generations as well as the tar sands that has destroyed large swathes of arboreal Canadian forest.

The tar sands are not shale oil.

[Bruce_S]

Think about the environmental wreckage of shale oil production. It's immoral to future generations as well as the tar sands that has destroyed large swathes of arboreal Canadian forest.

The tar sands are not shale oil.

Is the level of knowledge really so bad around here that you feel the need to point this out? I mean, isn't knowing what oil is like, the various names for the various types, in that liability release we digitally agreed to, to sign up around here?

[Moto]

Based on the comment I think it was a fitting remark.

While Shell is not my favorite company they are spending billions trying to clean up the tar sands. I'm not going to get into a debate on that right now, but I do think we are going to see them figure out ways to make it work both efficiently and cleanly.

It is estimated that about 5 million barrels a day will be coming from the sands before 2035 so.... They better figure it out.

and... before you freak out about that you should realize that more than half will be in situ production, and like everything else they will get better and cleaner. Canada is a bit more proactive regulation wise than the US so they will probably clean things up a little faster than we would.

If we want to talk about shale... Several drillers are switching to something called eco-pad where they basically drill a bunch of oil wells on the same pad. The benefits are less moving gear, fewer trucks, a smaller footprint, and easier infrastructure development. I have heard of up to 8 wells on one pad, but 4 is becoming common. (multiple horizontal horizons)