But what if the boom is just a bubble?
The Nation’s Number Two Tight Oil Play After a Year of Low Prices
The Bakken Play, located in North Dakota and Montana, is the birthplace of tight (shale) oil and in many ways the poster child of the so-called “shale revolution.” Between 2010 and 2014, oil production in North Dakota grew nearly five-fold, from 236,000 barrels/day in January 2010 to over 1,167,000 barrels/day in January 2015, according to the U.S. Department of Energy’s Energy Information Administration (EIA), which every year publishes its Annual Energy Outlook (AEO).
The EIA forecast this production growth to continue and — despite thousands of wells having already been drilled in the most productive areas of the play, and the steep decline in oil prices in 2014 — even raised its projection in 2015 for the total amount of tight oil produced in the Bakken through 2040 by 85% over the previous year’s forecast.
We recently asked David Hughes, author of Drilling Deeper (which likely remains the most thorough independent analysis of U.S. shale gas and tight oil production ever conducted) and a number of other reports on North American shale gas and tight oil production, to look at how production in the Bakken has changed after a year of low oil prices.
Oil production in the Bakken Play is now falling after more than a year of low oil prices—but it has proven more resilient than many observers expected. This paper reviews the latest developments in the Bakken Play and provides an update of the assessment in Drilling Deeper, which was published in October 2014 just as the turmoil in the oil markets began.
image credit: Tom Reichner / Shutterstock.com