Buddy i guess what they are trying to get across is the cost of these compared to offshore wells..... Still early days for alot of the bakken exploration but i'm sure the big player would not be there if they did not think it worthwhile.........cheers
While oil output from these deposits will not add decades worth of supply to the U.S. market, as they did for natural gas, it may potentially put more pressure on oil prices than its modest scale would suggest.
Unlike the deepwater fields of the Gulf of Mexico, which require years of planning and can therefore be factored into prices well in advance, oil from shale formations comes from a multitude of smaller wells that can be drilled quickly—potentially catching traders off guard in the same way that a stealthy natural gas glut walloped prices in 2008.
For example, North Dakota's oil production, three-quarters of which comes from the Bakken play, shot up from 85,000 bpd in 2004 to 218,000 bpd in 2009, according to the Energy Information Administration.
It rose by over 46,000 bpd in 2009 alone, a meaningful contribution to overall average U.S. production growth of close to 400,000 bpd or 8.3 percent—the first rise in a decade and a rate of growth that took some analysts by surprise. Total U.S production in 2009 averaged 5.36 million bpd.
MPO Price at posting:
$1.09 Sentiment: Hold Disclosure: Held
