We present a preliminary assessment of the Bakken oil Well Economics and Production Outlook. The price of oil is the major driver for drilling, but not the only one, as suggested by our analysis. Other parameters such as oil gravity, well drilling and completion costs, technology used, input factor productivity, presence of Three Fork in addition to Bakken drilling horizon can affect both well economics and expected production outlook. This paper presents the model developed to run production‐outlook scenarios varying assumptions on the listed parameters.
The last period of rising oil price that started in 2009 was the key driver for nearly exponential growth of the U.S. crude oil production. With the collapse of the oil price in late 2014, production growth stopped by mid‐2015. The active development of the Bakken oil play started over a decade ago with the introduction of horizontal drilling technology. The play has been one of the major contributors to U.S. production growth. Until recently, it was considered the biggest in terms of oil‐in‐place, now it stands second after the Permian Basin. It is important to understand the play economics and potential future development in this significant play. The present study investigates two key questions:
What is the well economics given the expected well productivity across the Bakken play under various prices?
How changes in economic conditions may affect the future play development in terms of total production?