Introduction
Over the past few years, new technology has led us to the discovery and development of large supplies of natural gas within shale plays across the United States. A shale play is a defined geographic area containing an organic-rich fine-grained sedimentary rock. Shale gas in the United States is rapidly increasing as an available source of natural gas.
The purpose of this report is to discuss estimated ultimate reserves of gas, oil, and NGL. Also, to discuss the drilling and development costs per well for the Eagle Ford shale, the Bakken shale, the Marcellus shale, and the Tuscaloosa Marine shale. Next, I will comment on the first exploratory well and the company responsible for the discovery well. I will then discuss the
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The shale play had a $60 billion impact on the local South Texas economy in 2012 and supported 116,000 jobs. Record drilling levels were reported, as well as some wells producing over 4,000 barrels a day. The Eagle Ford shale is the most active shale play in the world with over 200 rigs running and is best known for producing dry gas, wet gas, NGLs, and oil. According to the US Energy Information Administration, the average estimated ultimate recovery (EUR) of wells during 2008-2013 was 168,000 bbl / well. According to the U.S. Department of Energy, the estimated amount of technically recoverable oil is 3.35 billion barrels.
Petrohawk Energy received credit for drilling the first modern-day EFS well in 2008. Petrohawk also completed the discovery of the horizontal well with 10 frac stages along 3,200 ft lateral. Lewis Energy claims to have drilled the first EFS targeted well in 2002. Wells cost $6.5 to $7.0 million to fully develop.
Bakken Shale
The Bakken shale ranks as one of the largest oil developments in the U.S. in the past 40 years. The shale play has driven North Dakota’s oil production to levels four times higher than previous peaks in the 1980s. The Bakken shale play is located in Eastern Montana and Western North Dakota. Oil was initially discovered in the Bakken play in 1951, but wasn’t commercial on a large scale until 10 years ago. The Bakken oil production is economic due to modern horizontal drilling and hydraulic fracturing. The U.S.
fracking technique was not used on a commercial scale until the 1990s, in the Barnett Shale in
There are several types of shale that are drilled in which include: Bakken shale, Barnett shale, Eagle Ford shale, Haynesville shale, Marcellus shale, and Utica shale. Bakken shale is a formation of oil deposits that can be found in parts of Montana, North Dakota, and parts of Saskatchewan which is located in Canada (“What is Fracking”). Barnett shale contains large amounts of natural gas, and sometimes oil and can be found in North Texas (“What is
Shale is found in many colors but those that are very dark or black contain oil and gas. Conventional drillers look for pools of oil and gas above shale rock. “The oil and natural gas migrated out of the shale and upwards through the sediment mass because of their low density. The oil and gas were often trapped within the pore spaces of an overlying rock unit such as sandstone. These types of oil and gas deposits are known as "conventional reservoirs" because the fluids can easily flow through the pores of the rock and into the extraction well”. (Geology.com King) Conventional drilling into shale has declined because those conventional supplies are disappearing and drilling companies have known this for quite some time. They also know that more oil and gas can be extracted. Geology.com’s Hobart King provides this insight. “Although drilling can extract large amounts of oil and natural gas from the reservoir rock, much of it remains trapped within the shale. This oil and gas is very difficult to remove because it is trapped within tiny pore spaces or adsorbed onto clay mineral particles that make-up the shale. In the late 1990s natural gas drilling companies developed new methods for liberating oil and natural gas that is trapped within the tiny pore spaces of shale. This discovery was significant because it unlocked some of the largest natural gas deposits in the world” (King Geology.com). The site goes on to provide this outlook for fracking oil
In Texas, there is an economic powerhouse that not only runs deep beneath fields of cotton, but also reaches miles beyond the green pastures of cattle. Its multitude of uses in daily life also far outweighs the benefits of technology. This resource, greater than any other in Texas, is oil. In 1866 the first commercial oil well was dug near Nacogdoches, Texas but unfortunately the well came up dry. Thirty years later in 1894 oil was discovered in Corsicana, Texas by accident while a water well was being dug. This was the first economically significant discovery of oil in Texas. On January 10, 1901, Texas was catapulted into the era of oil and gas with the discovery at Spindletop. The Spindletop well, located south of Beaumont produced roughly
for approximately 20 years.7 Once hydraulic fracturing was commercialized, independent gas companies quickly pursued the opportunity. Today, nine companies compete for shale gas production in the U.S., and the major oil companies have moved more slowly since the smaller firms were the originators of fracking technologies.8 Hydraulically fracked wells in the U.S. today total over 500,000 and continue to grow rapidly.9 Another key factor which allowed rapid shale gas development is that U.S. law provides that landowners also own the natural minerals under their property, which enabled shale gas developers to lease land for drilling directly from homeowners (in most other countries, the government owns minerals found under properties). Future success with clean energy will require collaboration between the U.S. Government and industry, and our leaders must commit to advancing this agenda in parallel with the continued development of U.S. shale resources.
When most people think of Texas they think of the booming oil industry that the state has. According to our textbook, “Texas accounts for almost one-third of the country’s natural gas production and holds almost almost a quarter of the country’s natural gas reserves.” Texas has greatly invested in the recourses that are found within the state which makes gives the state a huge economic advantage. When fracking is used to help turn out even larger quantities of natural gas, the economic impact is huge. If the state greatly invested in fracking sites and the use of both traditional and horizontal fracking, the economic gain in the near future could be huge. The state could be turning out twice the amount of natural gas as it is
The most active fracking plays in the country of the United States. These are the top states in which hydraulic fracking occurs the most; New York, North Dakota, Montana, Texas, Louisiana, Arkansas, Colorado, Wyoming and Utah. The largest estimated U.S. oil and gas reserves are in Southern and Central California in the Monterey shale formation, though producers have faced significant challenges. The state is being targeted as the site of the next petroleum boom, and the topic of oil and gas leases in the state
Given fracking’s youth and considering its only significant sites are in the US, research is largely confined on the Marcellus region which runs across two-thirds of Pennsylvania and extends into other states (MSTEC 2011) or the Barnet region in Texas.
In 1949 Halliburton Oil Well Cementing Company obtained a patent for hydraulic fracturing, the first one issued in the United States. The method gained popularity and was soon used all over the world ("Hydraulic Fracturing of Oil & Gas Wells Drilled in Shale," n.d.). Despite its early start and popularity, hydraulic fracturing was not used on a large scale until 2003 when energy companies began to explore new ways of oil and gas production in the shale formations of Texas, Pennsylvania, West Virginia, Wyoming, Utah and Maryland. ("A Brief History of Hydraulic Fracturing," n.d.).
For more than sixty years, oil and gas companies have been fracturing shale rock far below the earth’s surface in order to release pockets of natural gas. The extraction of shale gas from wells dates back to 1821; but the revolutionary procedure of hydraulic fracturing—injecting pressurized fluid into shale rock to create fissures—was commercialized in the 1950s. New drilling techniques, created in the 1970s, reach previously inaccessible shale gas by allowing the use of horizontal piping within the wells. While the United States is currently dependent on foreign countries for natural resources, a hope for independence has led companies to further explore hydraulic fracturing, redefining the way that natural resources are
Insight, IHS Global. "The economic and employment contributions of shale gas in the United States." Prepared for America’s Natural Gas Alliance by IHS Global Insight (USA), Washington, DC: America’s Natural Gas Alliance (2011).
These reserves are found within shale formations. Shale is a sedimentary rock that is very low in permeability and porousness making it difficult to tap the gas and oil held within the formations. Due to the combination of fracking and new drilling technology, the production of natural oil and gas has constantly increased every year since 2006. In the year 1990, America reached a height of natural gas and oil production, producing about 70.706 quadrillion BTU of energy but that number would begin to decrease steadily due to the scarcity of acquiring natural gas and oil. In 2006 the production of energy was 69.443 quadrillion BTU. Accordingly, in 2010 fracking became popular and the production level reached 74.812 quadrillion BTU of energy. By 2011, the production of energy increased to 78.091 quadrillion BTU. The domestic production of natural gas and oil had a large contribution towards this growth. With this increase in production, the United states became the second largest natural gas producer in 2011.The European Union which is the third highest producer of natural gas and oil produced only about a quarter of natural gas and oil compared to that produced in the United
In 2000, shale beds where the number one source of America’s constant need for gas. Most of that production increase has come about to the growing need of hydraulic fracturing, also known as “fracking”, which is a process used to release oil or gas from underground formations that are otherwise too hard to mine with other tools. Over the past few years, advances in fracking technology have made huge reserves of natural gas in America economically recoverable. According to the Energy Information Administration, shale gas plays, or fields, in the United States, most notably the Marcellus, in Pennsylvania, West Virginia, and New York, and the Barnett, in Texas, are said to contain enough natural gas to give power to the country for a hundred and ten years. With the everlasting specter of energy independence, some have argued that such efforts to recover natural gas need to be expanded. Activists concerned with fracking’s potential environmental hazards view the new process as a serious threat to our environment. There are many different opinions on wether or not fracking is a safe way to gain our gasoline, and to meet the growing demands of gasoline around the world. The process of fracking creates cracks that come from wells into oil and gas formations by pumping highly pressurized fluids, ceramic beads, sand, and a mixture of chemicals, into the gas formation. As this fluid holds the underground fissures open, oil and gas fly up the well to the surface where they are
In the United States; most notably the Marcellus, in Pennsylvania, West Virginia, and New York, and in Texas are said to contain enough natural gas power the country for 110 years. In 2000, shale beds provided 1 percent of America’s natural gas supply. Today, that figure stands at nearly 25 percent. Most of that population increase is due to the growing popularity of hydraulic fracturing. With the enticing specter of energy independence in the balance, some have argued that such efforts to recover gas need to be expanded. While some activists believe that fracking’s potential environment hazards view the process as a serious threat. Water makes up a high percentage of fracking fluid that fluid also flows back up the well, and is stored in open pits until it can be sent to a treatment plant. A variable amount of
The Marcellus Shale is considered by many to be the most economically well off gas-bearing which is located in the United States. Thus making it a well sought after area for drilling companies, looking to drill out the natural gas. In the state of Pennsylvania the county with the most drilling permits is Bradford County in the north east.