North America has a remarkable amount of potential tight oil resources, but they may pale in comparison to those estimated worldwide, according to a study by IHS Inc.
The analytics firm on Tuesday issued the new geological study, “Going Global: Predicting the Next Tight Oil Revolution, at the IHS Forum in Houston. The research indicated that commercially producing those potential technical tight oil resources could equal or exceed current estimates for those in North America.
“This study makes clear that the potential for global tight oil is there and that it is very, very large,” said IHS Research Director Jan Roelofsen, who covers unconventionals. “The final measure of technical or commercially recoverable resources cannot be truly known until the actual well data is available. You simply cannot quantify it for sure until you begin to drill. But this study’s unique, data-based assessment shows that the potential of just the highest ranking plays is likely double the size of North America’s resources, and that is a conservative estimate.”
In February, PwC said worldwide production of shale oil had the potential to reach 14 million b/d by 2035, about 12% of the world’s total oil supply (see Shale Daily, Feb. 15). A Harvard Kennedy School researcher last year said global oil production capacity increases, including from unconventional U.S. oil, were accelerating so quickly that output could jump almost 20% by 2020 (see Shale Daily, June 27, 2012). Several U.S.-based operators are transferring the technical expertise they’ve honed in North America to prospects elsewhere, including ExxonMobil Corp. (see Shale Daily, June 19, 2012; Aug. 31, 2011).
Of 148 areas analyzed, IHS researchers said they had identified the 23 highest potential global tight oil plays and found the potential resources may be 175 billion bbl. North America has an estimated 43 billion bbl of potentially commercial tight oil resources, previous IHS studies have found.
The 23 biggest plays identified include the Vaca Muerta formation in Argentina, the Silurian shales in North Africa and the Bazhenov Shale in West Siberia. The list also includes geological plays in Europe, the Middle East, Asia and Australia.
Because well-level data is almost nonexistent outside of North America, researchers used a framework to group and analyze international plays based on their geological and depositional characteristics. Each play then was compared to its closest North American equivalent. The highest ranking pays were identified from a group of 148 potentials, each analyzed on geological and geochemical characteristics that included thickness, lithology, porosity, permeability, pressure, organic richness, presence of natural fractures and oil maturity.
Project leader Steve Trammel, also a research director for unconventionals, said the “screening and evaluation process revealed that the range of geological characteristics and risks of the 23 highest ranking global tight oil plays compare favorably, or even better in some cases, than those of leading North American plays.”
Although the commercial potential is not proven, “it is clear that it is by no means limited to the 23 highest ranking plays.” Market conditions, government policies and/or innovative exploration and production activity “could drive commercial developments in a number of the 125 additional tight oil plays that were screened for the study.”
“Given the range of below and above-ground issues to be managed, launching global tight oil development outside of North America will probably be much slower overall,” said IHS’ Pete Stark, senior research director for unconventionals. “But the potential is certainly there and there will be opportunities for early progress where the right conditions exist.”
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