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Canada’s New Shale Oil Field Could Rival the Bakken

Canada’s New Shale Oil Field Could Rival the Bakken thumbnail

Canada’s energy industry may be most famous for its world-class oil sands resources. But a new shale oil field could surpass the oil sands as Canada’s largest untapped oil reserve.

In fact, it could even rival the massive Bakken shale of North Dakota in terms of recoverable oil.

This area lies north of British Columbia and east of the Yukon. It’s the Northwest Territories.

Recent data from the National Energy Board (NEB) and the Northwest Territories Geological Survey shows that this area holds as much as 200 billion barrels of shale oil reserves. That compares to U.S. Geological Survey estimates that the Bakken shale formation will yield 4.3 billion barrels.

Not all of this Canadian oil is necessarily recoverable. But the Canol and Bluefish shales contain a total approaching 7 billion barrels of economically viable resources.

Here’s a look at the vast potential of Canada’s Northwest Territories…

A New Shale Oil Field with “Significant Potential”

Shale Oil FieldMajor oil companies have been exploring this area just 145 kilometers south of the Arctic Circle, known as the Mackenzie Plain, for some time.

Oil producers such as Husky Energy Inc. (TSE: HSE), Imperial Oil Ltd. (TSE: IMO), Royal Dutch Shell Plc. (NYSE ADR: RDS.A), and ConocoPhillips (NYSE: COP) have performed exploratory drilling in the Canol field.

A total of 14 exploration licenses have been granted with $628 million in work commitments dating back to 2010.

The Canol Field could hold as much as 145 billion barrels of oil. That’s comparable to Texas’ Permian basin, where about 3% of oil in place is currently being recovered by operators.

The Bluefish shale has yet to even be explored. It could hold up to 46 billion barrels.

David Ramsay, Minister of Industry, Tourism and Investment for the Government of the Northwest Territories, commented on the NEB data, saying, “This study confirms what we have known all along – that there is significant petroleum potential in the Sahtu.”

Developing these fields could be a ways off, however. Some living in the territory as well as Greenpeace oppose fracking, claiming it could contaminate groundwater.

Perhaps an even larger obstacle to development is infrastructure. The area’s remote location currently lacks such basic services as an all-weather road. A pipeline system to carry the recovered oil and gas to market will also need to be built eventually.

So now the big question: Can investors profit from this new Canadian shale oil field? 

Money Morning

23 Comments on "Canada’s New Shale Oil Field Could Rival the Bakken"

  1. gdubya on Sat, 30th May 2015 10:46 am 

    It might happen.
    There are no roads, pipeline or railways. The winter road season is decreasing. Not many truckers enjoy driving all the way up there for a short, unreliable season that breaks their trucks and is cold & unpleasant – but they will come if you pay them enough.
    Once the pads are in the drills and pumps might be able to operate all year (in the bugs) with helicopter (or aircraft if they can build a runway) support only.
    But they will be relying on the winter road to haul out a years supply of stored oil.
    I’m assuming that – like the Bakken – the well life will be too short to justify a pipeline.
    The Norman wells field has been going since 1942; the canol pipeline was built (and abandoned).
    So it might happen.

  2. Pveroi on Sat, 30th May 2015 10:47 am 

    Anyone want to guess what the EROI would be up there? Ps it’s permafrost, and the shale sweat spots in the states are at about 5:1

    “Will investors make money?” Is a dumb question. Real question is “is it worth it for society as a whole?” Since that’s who actually pays for these energetically useless plays.

  3. shortonoil on Sat, 30th May 2015 11:29 am 

    “So now the big question: Can investors profit from this new Canadian shale oil field?

    In short, No! We have been posting here for over a year about the Duvernay. A large shale condensate field 200 miles west of Fort MacMurray.

    09/25/14 PO News
    “New shale methods could yield huge results”

    The Duverany, because of its proximity to the bitumen mines, could supply diluent for about $12/ barrel less than the Bakken. But, at $60/barrel no one is going to be pumping oil 100 miles south of the arctic circle. That goes double for LTO! Of course, if anyone is stupid enough to invest in this hair brained scheme someone will be glad to spend their money. But that would be a charitable contribution, not an investment. You don’t expect to get your money back from a contribution!

  4. ghung on Sat, 30th May 2015 12:19 pm 

    Less than 3 months of global consumption. Gosh,,, that’s exciting.

  5. Jimmy on Sat, 30th May 2015 12:45 pm 

    Money Morning is a BS stock pumping scam. They were pumping the “new” discovery of oil in Australian outback a few years ago. They’re a joke. They are trying to sell a news letter and it is aweful. Just a waste of time paying attention to anything from Money Morning.

  6. rockman on Sat, 30th May 2015 1:24 pm 

    “But, at $60/barrel no one is going to be pumping oil 100 miles south of the arctic circle.” Time will tell: there was a plan to build a 1,200 mile pipeline from S La to Alberto to ship the LTO needed to blend with oil sands production so it can be pipelined. But, as said, is that plan still viable with current prices? Remember over 120 million bbls of US are exported from the US every year to Canada. Much of that (and condensate not classified as “oil) is used to dilute the oil sands production. About 25% of every bbl of “oil sands” shipped to the US is actually LTO blended with it.

    I’m sure our northern cousins would rather use their own LTO then buy ours. Boils down to the economics but I’m sure the Canadian govt would like to eliminate the flow of the $’s south.

  7. Gregg Pelletier on Sat, 30th May 2015 1:57 pm 

    There is no need to run a pipeline South–run the pipeline North and build a port. Then, transport the oil by tanker.

  8. fishin_in_the_muck on Sat, 30th May 2015 2:06 pm 

    The article wrongly intimates that the Bakken eserves rival the Canadian oil sand reservers.
    “But a new shale oil field could surpass the oil sands as Canada’s largest untapped oil reserve.

    In fact, it could even rival the massive Bakken shale of North Dakota in terms of recoverable oil.”

    Bakken estimated recoverable reserves: 7 billion barrels
    Oil Sand est. recoverable reserves: 168 billion barrels.
    World of difference.

  9. Nony on Sat, 30th May 2015 3:27 pm 

    The play is interesting, but there’s really not enough info to try to see what it’s real potential is (and even with more info, hard for those of us who are not hard core ITG type analysts to really judge it.) Weird things like clay content can impact what would be a profitable shale. Oil from shale that works out price wise seems much trickier than natural gas.

    Also, crude is (up) to 60 today. So it’s not like the market believes in this play being a game changer on the global scale.

  10. Nony on Sat, 30th May 2015 3:48 pm 

    I read up on it some on the net. Lots of articles going back to 2012, not a recent find. The access issues are pretty extreme. Not sure this is going to happen at 60.

    P.s. The Bakken easily has/had/will have the volume to justify at least a couple hundred thousand bpd pipeline. 60%+ of the volume is going out by train. Lots of great projects have been put forward, but they died because MN opposition to the rights of way. Keystone has really emboldened the nuttier types of anti ff advocates.

  11. John Simpson on Sat, 30th May 2015 4:02 pm 

    This is great news for Canada even as the Political winds shift sharply away from the conservative right . That said the Territories are rough country . Insects eat you alive in the summer , cannot move except along the waters ,as most all the land is muskeg . The winter is the only way to get around as everything freezes solid . Winds a howling at 50 below .

  12. GregT on Sat, 30th May 2015 4:12 pm 

    “Keystone has really emboldened the nuttier types of anti ff advocates.”

    Not anti ff advocates Nony. Do you really believe that anyone wants to give all of this up and return to the dark ages? Give your head a shake.

    Anti global mass extinctionists. Not everyone has their heads up their asses Nony.

  13. Welch on Sat, 30th May 2015 6:02 pm 

    Lovely. Right in the largest area of undeveloped wilderness left in the world. In the summer I guide on Kasba Lake, right at he southeast corner of red on the map. We’re 150 miles north of the nearest road, and the lodge is the only sign of modern man within that radius. I cringe when I read this kind of thing. They’ve been looking for diamonds and other minerals up there for years–hope they don’t find anyhing worthy nearby…it would be paradise lost.

  14. Makati1 on Sat, 30th May 2015 6:20 pm 

    Pipe dreams of the BAU crowd…

    Who here believes that the financial system is going to survive long enough to develop such a field, even if it is profitable? I don’t see the current financial system going for more than a few more years at best. Wylie Coyote is standing in the air and about to look down…

  15. Frederick on Sun, 31st May 2015 1:35 am 

    Looks good.

  16. GregT on Sun, 31st May 2015 1:43 am 

    Pretty awesome place to be Welch. Fight for it for future generations, or enjoy it while you can.

  17. Dredd on Sun, 31st May 2015 7:00 am 

    “My poison is better than your poison.”

  18. paulo1 on Sun, 31st May 2015 7:55 am 

    It won’t happen, Welch. Take heart.

  19. zoidberg on Sun, 31st May 2015 11:27 am 

    Sounds exciting. More oil is better. Means more wealth. Whether it’s profitable, I can’t say.

  20. yukonfisher on Sun, 31st May 2015 3:03 pm

    To add to the conversation, the outfits that had been exploring- Husky and Conoco Phillips- have pulled out at least for now.

  21. Johnny Franco Arboine on Tue, 2nd Jun 2015 6:14 am 

    The United States should get more of its oil from Canada for energy security and keep the economies of Canada and of the US afloat.

  22. GregT on Tue, 2nd Jun 2015 10:20 am 

    The economies of US and Canada will make little difference if we exploit all of the tar sands bitumen. There is more than enough tar left in Northern Alberta, to eradicate most of all life on the planet Earth.

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