Winter’s Coming; and the Bakken is Alive and Kickin’

 

I was recently in Bismarck, North Dakota at the 2017 Bakken Conference and Expo. I regularly visit many Geoforce customers as well as new and prospective ones in the region.

If shale plays were people, everyone would be jealous of the Permian for getting all the attention lately. It is the leader in national oil output growth, and just last year the USGS estimated that as much as 20 million barrels of recoverable oil lie beneath just a portion of the Permian, the Wolfcamp Basin.

It’s perhaps this new assessment that has prompted North Dakota’s officials to request a new estimate for the Bakken-Three Forks formation. The last one, from 2013, estimated recoverable reserves of crude in the formation at 7.4 billion barrels – twice the amount estimated by the USGS five years earlier.

Now, North Dakota’s Senator John Hoeven says these must be higher thanks to constant improvement in extraction technology. The Senator says a new estimate would motivate oil & gas companies to continue investing in North Dakota and prompt more of them to come to the Bakken and Three Forks. That’s especially true now that even Big Oil is turning to shale, where both turnaround times and returns are faster when compared to large-scale projects.

According to the North Dakota Mineral Resources Department, the state produced 1.03 million barrels of oil daily as of June. There are 54 active drilling rigs in the state as of August 30th, up from 33 a year ago. Despite the increase in rig count, production growth has been slow because of a shortage of fracking crews—something that’s becoming increasingly common across the shale patch as the industry recovers and demand for oilfield services outstrips supply.

North Dakota knows all too well the ups and downs of the oil boom… and bust. As a barrel of WTI crude soared over $145 in 2008, apartment buildings were built, businesses popped up, and the entire state seemed to benefit from the oil boom in the Bakken. The area saw the industry as an economic stimulus, a boon that North Dakota hadn’t seen before. At least, not quite like that.

It’s safe to say the Bakken boom put North Dakota on the map. People came from all over the world just to work in the Bakken. Now, oil is hanging out around $50-ish per barrel, with no real promise for an increase of more than a few dollars by year’s end.

North Dakotans are resilient, and have worked hard to navigate through post-boom obstacles, accepting what many are calling a “new normal” and learning to deal with some of the long-term side effects of the slowdown. Its reserves are making North Dakota more appealing for oil & gas players.

Notably, the Dakota Access pipeline started operations in June, replacing the costlier railways that carried as much as a quarter of the Bakken output to refineries. Now, three-quarters of North Dakota oil is carried by pipelines.

Geoforce maintains a positive presence in the area through its support of strong customer relationships with over 100 oil & gas customers that track thousands of assets in the region. Geoforce customers like EOG Resources, Hess, Schlumberger, Nuverra Environmental Solutions, Slawson Exploration, and Cahill Heating Rentals are supported with a Geoforce office within a few hundred miles, as well as regular trips like mine and other Geoforce support personnel just last week.

In addition to our great Oil & Gas customers, Geoforce has expanded its market footprint in the Dakotas with new customers that include mining and LTL freight carriers affected by the FMCSA ELD HOS Mandate.

We’re proud to have served the Bakken since 2008, and look forward to continue doing so. Even in the freezing cold of the upcoming winter!

David Mordoh is Geoforce’s Regional Sales Manager covering the Bakken.