Fracturing oil boom in US may confound Hubbert’s peak oil prediction

New drilling method opens vast oil fields in US

“Companies are investing billions of dollars to get at oil deposits scattered across North Dakota, Colorado, Texas and California. By 2015, oil executives and analysts say, the new fields could yield as much as 2 million barrels of oil a day — more than the entire Gulf of Mexico produces now.

This new drilling is expected to raise U.S. production by at least 20 percent over the next five years.  Oil engineers are applying developed in recent years to tap natural gas trapped in underground shale. They drill down and horizontally into the rock, then pump water, sand and chemicals into the hole to crack the shale and allow gas to flow up.

Petroleum engineers first used the method in 2007 to unlock oil from a 25,000-square-mile formation under North Dakota and Montana known as the Bakken. Production there rose 50 percent in just the past year, to 458,000 barrels a day, according to Bentek Energy, an energy analysis firm.

It was first thought that the Bakken was unique. Then drillers tapped oil in a shale formation under South Texas called the Eagle Ford. Drilling permits in the region grew 11-fold last year.

Now newer fields are showing promise, including the Niobrara, which stretches under Wyoming, Colorado, Nebraska and Kansas; the Leonard, in New Mexico and Texas; and the Monterey, in California.

…a surge in production last year from the Bakken helped U.S. oil production grow for the second year in a row, after 23 years of decline. This during a year when drilling in the Gulf of Mexico, the nation’s biggest oil-producing region, was halted after the BP oil spill.

U.S. oil production reached a peak of 9.6 million barrels per day in 1970…by 2008, production had fallen to 5 million barrels per day.

Within five years, analysts and executives predict, the newly unlocked fields are expected to produce 1 million to 2 million barrels of oil per day, enough to boost U.S. production 20 percent to 40 percent. The U.S. Energy Information Administration estimates production will grow a more modest 500,000 barrels per day”

Perhaps application of this technique in other parts of the US could add additional production capacity.

In Matt Simmons was right – Saudi Arabia overstated oil reserves, a Saudi Arabian official’s statement to the effect that the country’s oil reserves are far less than has been reported could mean that the cost of Saudi oil will be much higher than in the past. This would support additional production in the US.

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