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Presently the estimated breakeven price for the average well in the Bakken formation in North Dakota is $80-$90/bbl. In plain language this means that presently the commercial profitability for new wells is barely positive. The average well now yields around 85 000 bbls during the first 12 months of production and then experiences a year over year decline of 40%. The recent trend for newer wells is one of a perceptible decline in well productivity.
[Rune Likvern, 1/1/13]
While production continues to ramp up daily, there is one part of western North Dakota where the excitement of oil has gone bust. Chesapeake's attempt to find the southern edge of the Bakken is being described as the largest failure in drilling in the state since the 1980s...Tanks are there, collecting nothing. Well heads are in place, abandoned... Director of Mineral Resources for North Dakota, Lynn Helms said: 'There's only one well that's made any measurable oil, and it's about 10 percent oil at best, 90% water.' Chesapeake invested $60 million in the prospect of hitting oil. That excludes money spent on leases. 'Because all the drilling had been taking place north of there and the geological risk was zero, it made it look too easy. So in terms of the technology of drilling and fracking, well prepared, but in terms of geology probably not,' said Helms.
[KXNet.com, 1/1/13]
With 55 to 85% yearly decline rates how are those investors going to look in five years; especially in places like the Bakken which have $10 million wells. Eagle Ford has dismal production (143 b/d)...Chesapeake got into the shale gas game early, and is now selling everything the company has to stay out of receivership. Decline rates were much higher than originally projected. The rest of the shale industry will find the same thing happening to them.
Presently the estimated breakeven price for the average well in the Bakken formation in North Dakota is $80-$90/bbl. In plain language this means that presently the commercial profitability for new wells is barely positive. The average well now yields around 85 000 bbls during the first 12 months of production and then experiences a year over year decline of 40%. The recent trend for newer wells is one of a perceptible decline in well productivity.
[Rune Likvern, 1/1/13]
While production continues to ramp up daily, there is one part of western North Dakota where the excitement of oil has gone bust. Chesapeake's attempt to find the southern edge of the Bakken is being described as the largest failure in drilling in the state since the 1980s...Tanks are there, collecting nothing. Well heads are in place, abandoned... Director of Mineral Resources for North Dakota, Lynn Helms said: 'There's only one well that's made any measurable oil, and it's about 10 percent oil at best, 90% water.' Chesapeake invested $60 million in the prospect of hitting oil. That excludes money spent on leases. 'Because all the drilling had been taking place north of there and the geological risk was zero, it made it look too easy. So in terms of the technology of drilling and fracking, well prepared, but in terms of geology probably not,' said Helms.
[KXNet.com, 1/1/13]
With 55 to 85% yearly decline rates how are those investors going to look in five years; especially in places like the Bakken which have $10 million wells. Eagle Ford has dismal production (143 b/d)...Chesapeake got into the shale gas game early, and is now selling everything the company has to stay out of receivership. Decline rates were much higher than originally projected. The rest of the shale industry will find the same thing happening to them.