Pieces questioning the future oil production sustainability of shale development have been making the rounds lately in the media which is something industry-backed group Energy In Depth (EID) really dislikes. So when Ben Casselman of FiveThirtyEight wrote his latest "North Dakota's Oil Bonanza Is Unsustainable" they felt the need to respond:
- "FiveThirtyEight Assessment a Bust While Bakken Continues to Boom" by Katie Brown (EID)
Let's take a quick look at statements from the EID response:
"Anti-fracking activists have long been trying to convince the public that shale development is bound to go bust, and “likely” (the claim) in the very near future."
Being anti-fracking, and being skeptical of the future sustainability of Bakken production, aren't the same thing. But EID wants you to believe anyone that even slightly questions the production or financial sustainability of unconventional production is instantly "Anti-fracking." And it's a characterization I'm sure Ben Casselman would absolutely disagree with.
"First of all, studies have shown that the technology in question (fracking, coupled with horizontal drilling) is not static, but rather continually improving..."
The old, "technology is going to improve... trust us" position.
"In fact, due to technological advancements, there’s been a massive increase in the estimate of recoverable oil across the United States."
The old, "let's not talk about rates of production, let's talk about reserves instead" switch. No, actually what we're talking about is rates of production. That's the whole point of this discussion. Reserves are irrelevant.
Casselman even directly addressed this topic writing: "The issue isn’t whether North Dakota will run out of oil. There’s little doubt that the Bakken Shale, North Dakota’s main oil-producing reservoir, contains billions of barrels of crude. The question is about getting it out. A well’s production rate — how much oil it pumps in a given amount of time — falls quickly, and wells drilled into shale rock like the Bakken decline especially fast, as much as 70 percent in the first year. That means oil production is a treadmill: Companies have to keep drilling just to keep production flat. The more they produce, the more they have to drill to keep up."
"Lynn Helms of the North Dakota Industrial Commission... explained that oil production will stay level through 2025, producing slightly above one million barrels per day."
To be fair, "experts" at an industry function being positive about future oil production and actually fulfilling that claim are two very different things. Also, write that one down, it'll be interesting to check back in a few years down the road to see how that production call holds up. Remember when the Saudis claimed they could hit and maintain 12.5 - 15 mbpd for the next 30-50 years... that didn't exactly work out.
"And it’s not just a boom in production that’s notable – there’s also boom in enthusiasm surrounding this newfound prosperity from oil and gas."
Because if there's anything that's sure to continually increasing Bakken oil production... it's enthusiasm.
"But it’s important not to get trapped by assumptions of static technology..."
Just like it's important not to assume the inevitability of fairy tale future technology that doesn't exist yet.
"It’s important to exercise caution..."