The same horizontal drilling and hydraulic fracturing technologies that unlocked gushers across North America’s unconventional plays have so far turned up meager results in North Dakota’s Tyler Shale in Slope County.
Test wells by Marathon Oil Corp. have produced oil, but at rates reportedly not commercially viable at sub-$100/bbl prices. Two years ago, Marathon estimated that it could produce about 1.6 million boe from four test wells in Slope County. However, in Securities Exchange Commission quarterly filings, Marathon makes no mention of exploration activity in the Tyler Shale.
A spokesman for the Houston-based company told NGI's Shale Daily that Marathon has no "update at this time” on the formation, but he would not say whether activity in the play has ceased.
A spokeswoman for the North Dakota Department of Mineral Resources (DMR), which oversees oil/gas activity, said Marathon appeared to be the only exploration and production company (E&P) with permits to drill in the Tyler.
"Anything is possible with rapid advancements in technology, but at this time it looks like the Tyler formation is at least a $100/bbl play," she said.
Similarly, a spokesperson with the North Dakota Petroleum Council said the few E&Ps that have tried to tap into the Tyler came away "saying it is not economic at this point." There have been concerns about excessive amounts of water associated with oil in the play, the spokesperson said.
Since 1954, there have been 298 productive, mostly vertical, wells in the Tyler and 85 million bbls of oil produced, according to North Dakota Geological Survey (NDGS) geologists Timothy Nesheim and Stephan Nordeng. They wrote about the formation last year.
"Since 1997, Tyler production has steadily decreased with only 20 additional productive wells being drilled and completed," they wrote.
The Tyler Shale is neither a boom or a bust at this point, and still holds long-term potential, Nesheim told NGI’s Shale Daily.
"The Tyler holds a lot of oil -- on the order of billions to tens of billions of barrels across parts of western North Dakota -- and for comparison, the Bakken is thought to contain several hundreds of billions of barrels," he said.
"It has a lot of potential, but we don't have all the data on it that we need," he said. The formation has generated a lot oil, "and that oil is still in place." Ultimately, he thinks it comes down to developing the right technologies and extraction techniques to produce more oil in the future.
Nesheim said that before Marathon began its exploration efforts there were a half-dozen horizontally drilled wells targeting traditional sandstone basins. Two are still producing 30-50 b/d from the relatively thin sandstone layers.
"That's one step with the Tyler we could see in the future with companies drilling horizontal wells in sandstone layers of the formation," he said. "Today only about 1% of the production in the Tyler is from horizontal wells."
Eventually, DMR will obtain all of Marathon's data from the four most recent wells that were drilled.
"A key part of the information I am interested in involves the porosity of the rocks and the oil saturation," Nesheim said. "If you can get 10-20% porosity with high oil saturation, that's a lot of hydrocarbon capacity in the ground."
Besides Marathon, Nesheim said only two other recent wells were drilled in the Tyler -- both recompletions -- one by SM Energy Co. and another by Williston Exploration LLC. Neither well proved commercial.