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USGS doubles estimate of oil in the Bakken/Three Forks

Posted 5/08/13 (Wed)

USGS doubles estimate of oil in the Bakken/Three Forks

By Kate Ruggles
Farmer Staff Writer

On April 30, the United States Geological Survey (USGS) released an updated oil and gas resource assessment for the Bakken Formation and a new asessment for the Three Forks Formation in North Dakota, South Dakota and Montana. And the implications are huge.
According to the USGS, the Bakken and Three Forks formations contain an estimated mean of 7.4 billion barrels of undiscovered, technically-recoverable oil, which is a twofold increase over what they previously thought existed.
“These world-class formations contain even more energy resource potential than previously understood, which is important information as we continue to reduce our nation’s dependence on foreign sources of oil,” states Secretary of the Interior Sally Jewell.
In addition to oil, these two formations are estimated to contain 6.7 trillion cubic feet of undiscovered, technically-recoverable natural gas and 0.53 billion barrels of undiscovered, technically-recoverable natural gas liquids. The USGS states that these findings are nearly three times the increase of their 2008 estimate.
The reason for the huge increase in the USGS 2012 estimate over their 2008 estimate for oil, natural gas and natural gas liquids primarily has to do with the fact that this time around they included the Three Forks Formation.
According to the USGS, very little data existed on the Three Forks Formation in 2008, and it was generally thought to be unproductive. However, since the 2008 USGS assessment of the Bakken, more than 4,000 wells have been drilled in the Williston Basin, which has provided updated subsurface geologic data. Therefore, new drilling has resulted in a new understanding of the reservoir and its resource potential.
“This assessment shows the importance of Three Forks development, which is something that companies are just beginning to explore,” states Lynn Helms, director of the North Dakota Department of Mineral Resources. “We are happy to see the numbers released in this assessment have gone up from 2008, because it will give the state and counties, as well as operators, a better idea of what we can expect from development. And the data will assist in further planning of all the necessary components of oil and gas development, from regulation to roads and housing.”
What is interesting about the USGS findings is that, according to Sen. John Hoeven, their assessment is a direct result of a request he made of the former Interior Secretary to do a second assessment of the Bakken Formation and an initial assessment of the Three Forks Formation.
“More than two years ago, I persuaded former Interior Secretary Ken Salazar to initiate a new USGS study of the Williston Basin. This information will help stimulate more private-sector investment in infrastructure like housing, hotels, retail stores and other services to meet the needs of a rapidly growing western North Dakota,” states Sen. Hoeven.
Hoeven states that his request to Salazar was prompted by reports from companies operating in the Williston Basin, inferring that they believed there was significantly more recoverable reserves in the area than the 2008 report reflected.
In May, 2011, U.S. Interior Department Secretary Ken Salazar agreed to Sen. Hoeven’s request to update their estimates of recoverable oil reserves in the Williston Basin in order to generate a long-term outlook for production potential and infrastructure investment in the region. They then began the study in October 2011 and worked for 19 months to complete it.
“This new USGS study confirms and reinforces the fact that the Williston Basin is a sustainable, long-term play warranting strong private-sector investment for decades into the future,” states Sen. Hoeven. “This is clearly great news for North Dakota and great news for the nation.”
And the North Dakota representatives in Washington, D.C., could not be happier.
“The findings released by the USGS are an affirmation that North Dakota is going to continue to play a major role in America’s oil and gas development and production for decades to come,” states Sen. Heidi Heitkamp. “We are in an excellent position to use our resources to improve the lives of North Dakotans with smart investments, while also helping our nation become energy independent.”
“This new data is exciting for North Dakota, and for the United States, as we continue to work toward the important goal of national energy security,” states Congressman Kevin Cramer. “I want to thank Sen. John Hoeven for making such a strong case to the USGS for an updated study. This assessment confirms its need.”
Congressman Cramer states that the data from the Three Forks Formation is a direct result of new technologies becoming developed in the energy industry during the last five years.
“Looking forw ard, the future holds even greater potential for new discovery thanks to the ingenuity of our developers,” states Congressman Cramer.
In 2008, the DMR released its own assessment of the Bakken System at 2.1 billion barrels, followed by a 2010 assessment of the top 50 feet of the Three Forks development at 1.87 billion barrels, for a total of technically-recoverable oil just shy of four billion barrels. According to DMR spokesperson Alison Ritter, the department has no immediate plans to update its 2010 assessment, but has been collecting pertinent data should state policymakers feel an update is needed. Ritter also states that the department will continue to evaluate the results of this USGS assessment.