A U.S. Geological Survey (USGS) decision to reassess reserves potential in the Williston Basin, which includes the Bakken Shale and Three Forks formation, is encouraging to North Dakota officials, and they plan to contribute to it with a separate state survey.
Lynn Helms, who directs the state’s Department of Mineral Resources, said the previous USGS study seven years ago looked at 11 different source rocks. State geologists have since identified 23 additional source rocks, which means oil and gas reserves figures should move higher.
"There is a lot of source rock that has yet to be incorporated into the USGS study," Helms said. "So we think the numbers will go up, just because of the fact that we have a dozen source beds that haven't been included in the study, but we have a lot of work to do to make sure that happens."
The Bakken is estimated to be producing around 1 million b/d of oil.
"If the numbers go up, they clearly will attract more capital, and that will bring increased activity and increased production," Helms said. "That's why we are focused on making sure that everything we have gets counted by USGS."
Meanwhile natural gas production has exceeded expectations from a few years ago when the state established goals to reduce the amount of flared gas, which once was in the 36% range. "Gathering and processing of that gas is profitable so there has been a reason to come here and spend money on infrastructure," Helms said.
North Dakota now is at the statewide goal of 85% capture, but as associated gas output increases, capturing flared gas may be more difficult. During October, 10 operators did not meet the capture goal, and state regulators are assessing whether penalties may be levied.
"The biggest story in all this is that on the trust lands in Fort Berthold Reservation, the gas capture percentage was 69%," said Helms. He said Gov. Doug Burgum has met with the tribal council chairman to discuss ways to streamline the rights-of-way process to ensure critical infrastructure is built. "It looks like we can get there, but it will be a real foot race to maintain our gas capture goals.”
Recently, some operators have shut in production rather than miss the gas capture goals by self-restriction, he said. "It is not something that we can pinpoint by company or well, but overall in some counties we can tell operators are choking back wells.”
Like other basins, there also is "much longer sustained production from new wells" in the Bakken within McKenzie County from longer laterals and improved hydraulic fracturing techniques using “lots and lots of water and sand.”