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The Bakken, What the Data Tells US

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I have been supplied an Excel spreadsheet of all North Dakota wells back to 2006, thanks to Enno Peters and Dennis Coyne. I only used the data back to 2007 however. This is a wealth of information for if we want to know how many wells came on line in a given month, we simply count them. We are given the monthly production data for each month. And since we have the monthly production data we can very easily figure the decline rate of each well, or any group of wells for any month or year.

A note on the data. The first month data was almost always for a partial month. Sometimes the well came on line near the first of the month and sometimes near the end of the month. To get around this problem I have started with the second month, which is the first full month, and used that month as the first month of all my data. All data and charts below include all North Dakota wells, not just the Bakken.

NDIC Production Decline

Production per well has gradually increased each year. 2014 was the highest first month production but also the highest decline rate. Note that on the first month 2014 production is 29 barrels per day above 2013 1st month and 131 barrels per day above 2008 1st month.  But the 2014 10th month was 7 bpd below the 2013 10th month. And by the 2013 only 7 barrels per day separated the 2008 data and the 2013 data.

Bottom line is, though the new wells produce more, they decline a lot faster.

NDIC 1st Year BPD

Barrels per day per well, for the entire year, discarding the first partial month and measuring the 2nd through 13th month, averaged 230 BPD for 2013 and 241 BPD for 2014. The first-year barrels per day per well has increased every year except for 2012.

NDIC Wells per Month

The average number of rigs per month peaked in 2012 at 218 yet wells per month continued to increase. This is wells completed, not wells drilled. Yet wells drilled have increased even more than wells completed. At the end of 2013 there were 635 wells awaiting fracking. At the end of 2014 there were 750 wells awaiting fracking. Below is the Year – Wells per Month data represented in the chart above.

Year  – Avg. # of Wells per Month
2007 – 24
2008 – 43
2009 – 41
2010 – 68
2011 – 108
2012 – 157
2013 – 172
2014 – 187

NDIC Rigs & Wells

There is close to a 1 to 1 ratio between wells per month and active rigs per month. But remember there is a lag between when a well is drilled and when it is completed.

NDIC 2014 Change & Wells

There is only a very rough correlation between production increase, (left axis) and wells completed, (right axis).

2014 Bakken Data

The above is the data used for the previous two charts. The production change is in barrels per day.

Now lets deal with decline rates.

NDIC Annual Decline

The first year decline rate has continued to increase. One reason is the vast majority of new wells in 2014 are horizontal fracked wells where many of the 2007 through 2009 were conventional wells. But I doubt that this is the only reason.

NDIC Monthly Decline

First year monthly decline rates jumped to a whopping 8.33% in 2014 versus 7.97% in 2013. However the 2014 decline rate is only for the first 10 months as December had only a partial months data so the decline for November could not be calculated.

Also, the monthly decline rate is erratic and not exact. Some months are shut down for part of the month causing the figures to jump around. The Annual decline rates are much better but still not exact.

The question still remains is how many wells must be completed each month for production to remain flat. I have figured it every way possible and I come up with 130 wells using the data above but using the EIA’s legacy decline rate I come up with 143. But it is the number of wells fracked each month that counts, not the number of wells drilled.

There were 730 wells awaiting fracking crews at the end of December. At the end of December 2013 there were 635. From the Directors Cut for February 2014:

We estimate that at the end of Dec there were about 635 wells waiting on completion services, an increase of 125.

And it jumped 50 the previous month, November 2013. Apparently this was because of the weather. When it gets very cold it slows fracking down rather dramatically, far more than it does the drilling crews. From what I can tell February 2015 will be a very slow fracking month. I am not so sure about January.

But the point is, they could drill only 120 wells per month and but frack 150 and keep production increasing. And with 750 wells waiting to be fracked they could continue at this pace, fracking just 30 more wells than drilled, for about two years before production starts to drop. But the rig count may drop much lower. And are fracking crews suffering the same attrition as drilling rigs and crews?

On another subject, this was emailed to me a couple of days ago:

I wanted to pass on to you that a friend in management at a local NYSE listed company told me last week that wells may have to be shut in if some storage capacity doesn’t open up soon. Every tank battery, truck, tank farm, and pipeline is full.

Take away from that what you will.

And then there is this. We talked about this a month or so ago but now new information and pictures are available.  And be sure to go to the link below. They have a lot more pictures there:

Are Siberia’s mysterious craters caused by climate change?

Scientists find four new enormous holes in northern Russia

Siberian Crater

  • Four new craters have been spotted by scientists in the Yamal peninsula, in Siberia
  • May be caused by gas from underground and fear craters becoming more common due to rising temperatures
  • Bright flash of light seen close to one crater which led to theories that buried gas pockets in the soil may be igniting 
  • Another new crater has been found less than six miles from a major gas plant and experts have called for an urgent investigation into the phenomenon 

Until now, the existence of only three Siberian craters had been established when great caverns in the frozen landscape were spotted by passing helicopter pilots.

‘We know now of seven craters in the Arctic area,’ Professor Bogoyavlensky told The Siberian Times.

‘Five are directly on the Yamal peninsula, one in Yamal Autonomous district, and one is on the north of the Krasnoyarsk region, near the Taimyr peninsula.

‘We have exact locations for only four of them.

‘The other three were spotted by reindeer herders.

‘But I am sure that there are more craters on Yamal, we just need to search for them. I would compare this with mushrooms.

‘When you find one mushroom, be sure there are few more around. I suppose there could be 20 to 30 craters more.’

peak oil barrel

6 Comments on "The Bakken, What the Data Tells US"

  1. rockman on Wed, 25th Feb 2015 10:05 am 

    Great analysis…thanks. As far as ” wanted to pass on to you that a friend in management at a local NYSE listed company told me last week that wells may have to be shut in if some storage capacity doesn’t open up soon. Every tank battery, truck, tank farm, and pipeline is full.” Do I assume correctly they are just talking about ND? Nationally about half the oil storage capacity sits empty according the EIA.

  2. Plantagenet on Wed, 25th Feb 2015 11:09 am 

    Interesting to see that the production per well in the Bakken continues to increase. This is the exact opposite of what David Hughes and the folks at the post-carbon institute have been saying—their claim that the “sweet spots” in the Bakken would be used up in a year or two and then production would drop is clearly wrong.

  3. Brent on Wed, 25th Feb 2015 1:43 pm 

    So much for the efficiency increases all that means is that the shale wells are getting depleated faster.

  4. Plantagenet on Wed, 25th Feb 2015 2:09 pm 

    Either that or the holes are getting longer and the fracking jobs are doing a better job of accessing the oil.

    And that equates to GREATER efficiency, which means lower costs per bbl.

    ERoEI in the Bakken will never get much better than 10:1 but every little bit helps.

  5. baptised on Wed, 25th Feb 2015 3:00 pm 

    Thanks peak oil barrel for a clear good article.

  6. DMyers on Wed, 25th Feb 2015 7:10 pm 

    The point being made and supported by some here is that faster extraction leads to faster depletion. I agree with that position. Further confirmation of this comes from the data, where we see this positive relationship between extraction and depletion.

    On a basic level this raises the question, what is gained by this higher rate of extraction? Clearly, it does not produce abundance out of nothing, but merely exhausts the resource more quickly. Taking economics out of it, that does not, on its face, seem to do anything more than trade the future for the present. For that reason, I’m not jumping up and down over the higher production levels.

    Plant, with respect to your “holes are getting longer…” comment, you have to acknowledge that longer holes mean greater investments of $ and energy, probably exponentially so, by the foot.
    So when you calculate that ERoEI in the Bakken, don’t forget to take fully into account the per foot energy invested in long hole technology.

    You may like your holes long and wide, but I like mine short and tight. In any event, you don’t get a hole without investing a lot of energy, something the laws of nature have set, firmly.

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