Menu

Will New Methods Make Shale Oil Viable?

High-intensity hydraulic fracturing is helping produce oil more economically. This new method of fracking uses more water, minerals and high pressure to break up shale. The use of more pressure, water and minerals increases the cost of fracking, however, the enhanced completion techniques can boost productions rates within the first crucial year of production and beyond.

Fracking wells reach peak production quickly, then enter a rapid decline rate, followed by a low output. With the new frack method the pressure creates massive networks of fissures while the increased amounts of sand and ceramic keep shale fractures open allowing oil to flow. This creates better production within the first year and that leads to higher total recovery over the life time of the well.

Previously drillers may have pumped 300 to 500 pounds of frack fluid per foot, with the new enhanced frack recovery method the driller will pump 1,500 to 2,000 pounds per foot. Companies using this method are Whiting Petroleum and Oasis Petroleum in the Bakken and Concho Resources in Texas.

During the final quarter of 2014, Concho Resources reported an 18 percent increase in average 30 day production rates from 2013. However, when using the enhanced frack completion method, Concho Resources saw a 75 percent increase in cumulative production over 180 days during that same frame. They saw a much higher return rate in the first 30 days, they also realized a much shallower decline in subsequent production.

Source: Paul Thares, South Dakota State University 

Recent News

COVID-19 Impacting Food Purchasing Dynamics, As Ag Labor Concerns Persist
4/3/2020

Wall Street Journal writer Kirk Maltais reported this week that, “Consumers’ rush to buy groceries is fueling a rally in orange-juice prices, making the usually sedate asset the best-performing commodity in the first quarter of 2020. “The price of frozen orange-juice-concentrate futures trading on the Intercontinental Exchange has surged 24% to more than $1.20 a pound since March 19—a run resulting from […]

During COVID-19 Outbreak, Some Countries Restrict Ag Exports
4/2/2020

Wall Street Journal writers Kirk Maltais and Joe Wallace reported this week that, “Consumers are loading up on pasta, rice and bread. Farm supply lines are disrupted. Countries are restricting agricultural exports. The result: Prices of wheat and rice, two of the world’s staple grains, are rising sharply. Difficulties moving grain within countries and across borders, coupled with […]

Old-Crop Cash Flow Considerations Under COVID-19
4/1/2020

Reductions in the sales value of unpriced grain likely will be the first place where grain farms feel the impacts of COVID-19 control measures. Overall, old-crop sales likely will be reduced from expectations prior to COVID-19 concerns. Some farms will be more impacted by these concerns than other farms. Before discussing old-crop cash flows, a […]

Your browser is out-of-date!

Update your browser to view this website correctly. Update my browser now