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600 East Boulevard Ave. - Dept 405 Bismarck, ND 58505-0840
(701) 328-8020 (701) 328-8000
North Dakota Department of Mineral Resources
http://www.state.nd.us/ndgs http://www.oilgas.nd.gov
Western North Dakota
• 1,100 to 2,700 wells/year = 2,000 expected
– 100-225 rigs = 12,000 – 27,000 jobs
– Another 10,000-15,000 jobs building infrastructure
– 200 rigs can drill the wells needed to secure leases in 1 year
– 225 rigs can drill the wells needed to develop spacing units in 16 years
– 35,000-40,000 new wells = 45,000-50,000 long term jobs
Typical Bakken Well Production
904
427
149
10582 66 56 50 45 43 41 39 37 35 33 31 30 28 27 26 24 23 22 21 20 19 18 17 16 15 15 14 13 12 12 11 11 10 10 9 9 8 8 7 7 7
0
100
200
300
400
500
600
700
800
900
1000
0 5 10 15 20 25 30 35 40 45 50
Year
Bar
rels
of O
il pe
r Day
A typical 2012 North Dakota Bakken well will produce for 45 years
If economic, enhanced oil recovery efforts canextend the life of the well
In those 45 years the average Bakken well:
Produces approximately 615,000 barrels of oil
Generates about $20 million net profit
Pays approximately $4,325,000 in taxes$2,100,000 gross production taxes$1,800,000 extraction tax$425,000 sales tax
Pays royalties of $7,300,000 to mineral owners
Pays salaries and wages of $2,125,000
Pays operating expenses of $2,300,000
Cost $9,000,000 to drill and complete
North Dakota Oil Production
0100,000200,000300,000400,000500,000600,000700,000800,000900,000
1,000,0001,100,0001,200,0001,300,0001,400,0001,500,000
1970
1975
1980
1985
1990
1995
2000
2005
2010
2015
2020
2025
2030
2035
2040
2045
2050
2055
Bar
rels
per
Day
History Bakken - Three Forks P10 Bakken - Three Forks P50 Bakken - Three Forks P90
4,040 Bakken and Three Forks wells drilled and completed 36,000 more new wells possible in thermal mature area Proven=7 BBO Probable=10 BBO Possible=15 BBO (billion barrels of oil)
Proven
Possible
Probable
Expected Case North Dakota Oil Industry Jobs
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Year
Jobs
Prod jobs Gathering jobs Fracing jobs Drilling jobs
Expected Case
North Dakota Rigs and Wells
0
50
100
150
200
250
300
2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Year
0
5000
10000
15000
20000
25000
30000
35000
40000
45000
50000
Rigs Wells
The North Dakota Way
Vern Whitten Photography
Vern Whitten Photography
Six Wells on a Single Pad
Oil and gas well locations are built (stockpiling top soil and lining reserve pits) to make reclamation easier.
DRILL TO BASE OF POTABLEWATER SOURCES WITH FRESHWATER
4 ½” Frac String
Upper Bakken Shale
Lower Bakken Shale
Middle Bakken
Potable Waters
• Drill with fresh water • Total depth below lowest potable water • Run in hole with surface casing • 1st layer of surface water protection • Cement casing back to surface of ground • 2nd layer of surface water protection
TYPICAL HORIZONTAL OIL WELL
9-5/8” in 13.5” Hole
DRILL TO TOP OF HYDROCARBON ZONE WITH FRESH WATER, SALT WATER OR OIL BASE MUD
4.5” Frac String
Upper Bakken Shale
Lower Bakken Shale
Middle Bakken 10,000’
Potable Waters
TYPICAL HORIZONTAL OIL WELL
Cement
Packer
Run in hole with: • 4.5” liner • 30-40 swell packers
• sliding sleeves
4.5” liner
• 9 5/8” surface casing • 7” production casing • 4.5” liner • 30-40 swell packers • sliding sleeves • 4.5” frac string • 5 layers of protection
Precambrian Basement
Red River Formation
Madison Group Tyler Formation Spearfish Formation
Dakota Group
Fresh Water Zone
Prairie Formation Bakken-Three Forks
Shallow Gas Zone
A Salt
Spearfish Formation:
Prairie Salt
D Salt F Salt
Charles Formation:
Prairie Formation:
Opeche Formation:
Dunham Salt Pine Salt
Salt A
Piper Formation:
Significant Salt Intervals of Northwestern North Dakota
PLUG AND ABANDON
Cmt. Plug
Cmt. Plug
Cmt. Plug
Cmt Plug
Well was plugged in 07/1998
Reclamation work in 09/1998
Seeded in Spring of 1999
The North Dakota Challenges
North Dakota Monthly Gas Flared
0%
5%
10%
15%
20%
25%
30%
35%
40%
1985 1990 1995 2000 2005 2010 2015
$4b
The future looks promising for sustained Bakken/Three Forks
development
Draft BLM Hydraulic Fracturing rule could double federal drilling
permit approval time or worse. Comments due
7/10/12
Draft EPA guidance on diesel fuel in hydraulic fracturing could triple
drilling permit approval time or worse.
Comments due 7/9/12
Current administration budget contains tax changes that could
reduce drilling capital 35-50%
World and U.S. economies continue to struggle. If
China joins the downward spiral oil price could fall enough to make some
areas uneconomic
Slide Number 1Slide Number 2Slide Number 3Western North DakotaSlide Number 5Slide Number 6Slide Number 7Slide Number 8Slide Number 9Slide Number 10The North Dakota WaySlide Number 12Slide Number 13Slide Number 14Slide Number 15Slide Number 16Slide Number 17Slide Number 18Slide Number 19Slide Number 20Slide Number 21Slide Number 22Slide Number 23Slide Number 24Slide Number 25Slide Number 26Slide Number 27Slide Number 28Slide Number 29Slide Number 30Slide Number 31The North Dakota ChallengesSlide Number 33Slide Number 34Slide Number 35Slide Number 36Slide Number 37Slide Number 38Slide Number 39
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