Wells in North Dakota's Bakken shale show promise for huge new oil deposit
- On Tuesday July 14, 2009, 1:46 pm EDT
BISMARCK, N.D. (AP) -- Dozens of fruitful wells beneath the rich Bakken shale in North Dakota continue to fuel a hunch among oilmen and geologists that another vast crude-bearing formation may be buried in the state's vast oil patch.
Lynn Helms, director of the state Department of Mineral Resources, said recent production results from 103 newly tapped wells in the Three Forks-Sanish formation show many that are "as good or better" than some in the Bakken, which lies two miles under the surface in western North Dakota and holds billions of barrels of oil.
"I think it's a big deal and we're pretty fired up about it," Helms said.
Companies have reported some Three Forks wells recovering more than 800 barrels daily, considered decent by Bakken standards.
Denver-based Whiting Petroleum Corp. has drilled two wells in the Three Forks formation, with one that recorded more than 1,000 barrels of oil a day, said John Kelso, a company spokesman.
"We are excited about Three Forks but it's early on in the play," Kelso said. "I do know a lot of companies are redirecting focus from the Bakken to Three Forks."
Whiting has one Bakken well that recorded more than 4,000 barrels a day last year, thought to be a record for the formation and about double the highest Three Forks well drilled to date.
Kelso said Whiting's primary focus at present is on the Bakken. The company has more than 300,000 acres under lease in North Dakota.
"With the turbulence in crude oil prices, we've kind of backed off Three Forks for the Bakken," Kelso said. "We will very likely get after Three Forks in 2010, depending on oil prices.
The Bakken formation encompasses some 25,000 square miles within the Williston Basin in North Dakota and Montana. The U.S. Geological Survey has called it the largest continuous oil accumulation it has ever assessed.
The Three Forks-Sanish formation is made up of sand and porous rock directly below the Bakken shale. But geologists don't know whether the Three Forks-Sanish is a separate oil-producing formation or if it catches oil that flows from the Bakken shale above.
Fort Worth, Texas-based XTO Energy Inc. has reported to the state that one of its Three Forks wells pulled more than 2,100 barrels a day. An ETO Energy spokeswoman said the company does not comment on its operations publicly.
State and industry officials are conducting a study to determine whether the Three Forks is a unique reservoir. The plan is to compare results from closely spaced wells, one aiming for the Three Forks, and the other at the Bakken. Researchers will look at pressure changes in the formations to determine if they are connected.
Results from the study could be ready later this year, officials say. It already is spurring some speculation that the state has billions of barrels more in oil reserves.
"Eventually it could equal the Bakken, which is remarkable, and that's an understatement," Helms said.
"Is it the same or is it a separate formation? I think everybody is hoping for the latter," Harms said. "That could literally double the potential we have -- a Bakken 2, if you will."
Kelso, of Whiting Petroleum, said his company's drilling activity shows that Three Forks likely is a separate formation. He said core samples taken from the Bakken and Three Forks show more hydrocarbons in the latter.
"From the core samples, Three Forks looks better for us than the Bakken," he said.
Promising production results from the Three Forks could mean that companies that come up empty in the Bakken could use existing leases to drill in the same area for Three Forks oil.
Geologists say the Three Forks-Sanish is typically about 250 feet thick. Julie LeFever, a geologist with the state Geological Survey in Grand Forks, has studied the Bakken for two decades. She believes oil found in the Three Forks-Sanish has come from the Bakken over millions of years.
"It's probably all the same source system. The reservoir may or may not be unique," she said. "We're still trying to figure out what makes the whole formation tick."
"It's another target," LeFever said. "If the Bakken doesn't pay, maybe the Three Forks will."
Most companies working in the state's oil patch continue to focus solely on the Bakken, said Ron Ness, president of the North Dakota Petroleum Council, a Bismarck-based group that represents about 160 companies.
"I think it's a huge deal," Ness said of the emerging Three Forks play. "But it is still vastly unknown and overshadowed by the urgency to develop the Bakken."
Donald Kessel, vice president of Houston-based Murex Petroleum Corp., said his company was among the first to get a producing well in the Bakken in North Dakota about four years ago. The company now has 26 producing wells in the Tioga and Stanley areas of northwestern North Dakota.
Kessel believes that not all of the Three Forks is laden with oil.
"Right now, we're doing Bakken, and in those areas it doesn't look like the Three Forks is going to work," he said.
"With Three Forks, you have got to find a sweet spot where it develops," Kessel said. "It is not sandwiched like the Bakken between two shales producing oil."
Oilmen and others had known for years that the Bakken held oil. High oil prices and demand in the past few years spurred technology enough to begin tapping it.
Kessel said techniques learned from the Bakken are now being used at other oil shales in the U.S. and internationally. But he said advances in technology have slowed with lower oil prices that have idled drill rigs.
"Technology is not moving at the same pace because there are fewer well bores to do it at," Kessel said.
State geologist Ed Murphy said researchers will know more about the characteristics and potential of the Three Forks formation once more wells are tapped into it.
"One-hundred wells is not that many wells when you're trying to look at overall trends," Murphy said. "Everyone will feel a lot safer with 100 or 200 more wells down the road."
Drilling and well completion technology developed for the Bakken formation likely also could be used in the half-dozen formations above the Bakken and the dozen or so that reach 4,000 feet below it, he said.