BISMARCK, N.D. — Oil drillers targeting the rich Bakken shale formation in western North Dakota and eastern Montana have produced 1 billion barrels of crude, data from the two states show.
Drillers first targeted the Bakken in Montana in 2000 and moved into North Dakota about five years later using advanced horizontal drilling and hydraulic-fracturing techniques to recover oil trapped in a thin layer of dense rock nearly two miles beneath the surface.
North Dakota has generated 852 million barrels of Bakken crude, and Montana has produced about 151 million barrels through the first quarter of 2014, data show.
Continental Resources in Oklahoma City, one the oldest and biggest operators in the Bakken, said two-thirds of the production has come in the past three years.
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“This milestone validates the immense potential of the Bakken field, and development is just beginning,” the company said.
Experts had known for decades that the Bakken held millions of barrels of crude, but it wasn’t until oil prices reached record levels that the technology was developed to the point of being able to exploit the formation.
The Bakken encompasses some 25,000 square miles in North Dakota, Montana, Saskatchewan and Manitoba. About two-thirds of the acreage is in western North Dakota.
Unlocking the once-perplexing formation has propelled North Dakota from the nation’s ninth-largest oil producer in 2006 to No. 2, behind Texas.
The Bakken and the Three Forks formation directly below it account for about 94 percent of North Dakota’s current oil production, which is nearing 1 million barrels a day, said Alison Ritter, a North Dakota Department of Mineral Resources spokeswoman. Three Forks production is counted toward Bakken production.
Ron Ness, president of the North Dakota Petroleum Council, said the milestone of a billion barrels of oil is less important than the Bakken’s economic impact on the region.
“Barrels are just barrels,” said Ness, whose group represents more than 500 companies working in North Dakota’s oil patch. “It’s that long-term investment that’s important. The Bakken has been a huge asset to the state, the region and the nation.”
The U.S. Geological Survey has called the Bakken the largest continuous oil accumulation it had ever assessed. The agency, which bases its data largely on information from oil company and state drilling records, said up to 7.4 billion barrels of oil could be recovered from the Bakken and the underlying Three Forks using current technology.
Geologists and oil companies have mixed opinions on whether the Three Forks is a separate formation or acts as a trap, catching oil that leaks from the Bakken shale above. Some say it could be a combination of both.
To capture crude from the formations, companies drill down nearly two miles then angle the well sideways for about another two to three miles. A pressurized concoction of water, chemicals and grit is injected to break open oil-bearing rock, which allows the oil to flow to the well.
That technique, known as hydraulic fracturing, or fracking, has been blamed for endangering water quality in some states. North Dakota regulators say the state’s water sources are protected by thousands of feet of geologic formations atop fracturing operations.
Economists support more oil, natural-gas exports
NEW YORK — Whether to allow more exports of U.S. oil and natural gas has become a matter of political debate in Washington, D.C. But to economists, the answer is clear: The nation would benefit.
The majority of economists surveyed this month by The Associated Press say lifting restrictions on exports of oil and natural gas would help the economy even if it meant higher fuel prices for consumers.
More exports would encourage investment in oil and gas production and transport, create jobs, make oil and gas supplies more stable and reduce the U.S. trade deficit, they say.
As domestic-energy production has boomed, drilling companies have pushed to be allowed to sell crude oil and natural gas overseas, where they can command higher prices. Such exports are restricted by decades-old energy-security regulations.
Those opposed to opening trade say exports could make it more expensive for Americans to heat their homes and fill up their cars.
But even economists who think exports might increase fuel prices for U.S. consumers — an open question — say the overall benefit to the economy would outweigh any possible harm. It would be better to allow the exports and use tax breaks or other methods to help those struggling with higher prices, they say.
“The economy in general is better off if we can sell something to someone and bring money into the economy,” said Jerry Webman, chief economist at Oppenheimer Funds.
The AP survey collected the views of private, corporate and academic economists on a range of issues. Of the 30 economists who participated, nearly 90 percent responded that more exports of oil and gas would help the U.S. economy.
Oil- and gas-export restrictions went largely unchallenged for decades because consumption in the U.S. — by far the world’s biggest consumer of oil and gas — was rising while production was falling. Imports were increasing, and few thought the U.S. would ever be in a position to export oil or gas.
But new techniques have allowed drillers to tap oil and gas in formations once thought out of reach, and U.S. production has soared.
The U.S. still consumes far more crude oil than it produces. But oil companies are producing a light sweet crude that foreign refineries covet and that many U.S. refineries are not equipped to handle.
Seven terminals have received Energy Department approval to export natural gas and are at various stages of planning.
Low natural-gas prices in the U.S. have helped reduce heating and electricity prices for residents and given U.S. manufacturers a cost advantage over their competitors in Europe and Asia.
— The Associated Press