Posted 4/06/11 (Wed)
By Neal A. Shipman
When oil was first discovered in North Dakota 60 years ago this week, who would have ever imagined the wild ride that the industry would take the state on. Or who would have ever dreamed that today, 60 years later, North Dakota would be the hot spot of oil development in the nation.
Ever since the discovery of oil on the Clarence Iverson farm near Tioga on April 4, 1951, North Dakota has been on a tumultuous ride, to say the least, with the oil industry. We’ve seen the early boom in the 1950s which peaked with over 400 wells being drilled annually, and then a resurgence in oil drilling again from the mid-70s to the early ’80s. But North Dakota has also seen the oil industry quite literally pack up and leave the state following those boom years.
But here we are 60 years later, and thanks to the discovery of the Bakken and Three Forks formations, North Dakota’s oil patch is back stronger than ever as new drilling records are being set and the state’s oil production is now the fourth largest in the nation.
While the oil industry has always known that the Bakken Formation existed, until technology in the way of horizontal drilling and hydraulic fracturing become feasible, this formation couldn’t be economically developed. What they didn’t know was how much oil was in the Bakken or the Three Forks formations. But once that information became public and drilling technology improved, it was “Katie bar the door” as drilling activity in western North Dakota took on a whole new level of activity.
How productive could the Bakken and Three Forks formations be? According to an Associated Press article, the U.S. Geological Survey is estimating that up to 4.3 billion barrels of oil could be recovered from the Bakken in North Dakota and Montana and an additional 1.9 million barrels of crude can be recovered in the underlying Three Forks Formation.
That’s a whole bunch of oil, which is why in the past three years over 2,000 new producing wells have been drilled into these two formations alone. And with a 99 percent success rate of hitting oil and nine out of 10 of these wells being profitable, it is no wonder that nearly 95 percent of all new wells being drilled in the state are aimed at these two formations.
To put this new development into perspective, consider if you will that in 2008, the state’s oil production was 63 billion barrels of oil. In 2009, production increased to 80 million barrels only to be eclipsed in 2010 when North Dakota set a record by pumping 113 million barrels of oil. And that number, according to state officials, is going to go even higher with estimates being put forth that the state will produce 700,000 barrels daily in four to seven years.
With billions of barrels of oil still to be tapped into, North Dakota’s long-term oil future looks very, very good.
And that is good news for western North Dakota.