Something Else to Watch in 2011: ND Oil Boom; Running Out of Superlatives As Estimates Double

BISMARCK, N.D. (AP) -- "Government and industry officials believe North Dakota's oil patch contains more than twice the amount of oil previously estimated and that the state's already record crude production will double within the decade.  If the forecast is correct, North Dakota could leapfrog in a few years from the fourth-biggest oil producing state to No. 2, trailing only Texas.

"It's a pretty rosy picture," said Lynn Helms, director of the North Dakota Department of Mineral Resources. "We have a huge amount of drilling still in front of us."

Record rig activity pushed by strong crude prices and refinements in drilling technology could result in North Dakota seeing a twofold increase in production. The drilling technology alone has cut the amount of time needed to complete a well from 65 days in 2008 to about 25 days. "We are now looking at the possibility of 700,000 barrels a day and we see that coming in the next four to seven years," Helms said.

At that rate, North Dakota would surpass California and Alaska based on those states' current production, said Steven Grape, the domestic reserves project manager for the U.S. Department of Energy's information administration.  "That would be pretty amazing in my book," Grape said.

Federal and state estimates had pegged North Dakota's portion of the Bakken shale and underlying Three Forks-Sanish oil formations in western North Dakota at about 5 billion barrels of oil, using current horizontal drilling technology. Helms said that estimate has more than doubled based on drilling success and current production rates." 

"We're starting to see indications that we could reasonably get 11 billion barrels," Helms said.  Helms said nothing surprises him anymore about the state's prolific oil patch. "I'm running out of superlatives," Helms said. "We're going to have to invent some new ones."

HT: Buddy Pacifico