Exploring in the Niobrara Shale
Wyoming producers are in the exploratory phase in the Niobrara Energy Play in Southeast Wyoming. While geologists have known about the resource potential in the Niobrara for decades, unlocking the resources is a whole new ballgame.
Companies have rigs in Southeast Wyoming going from prospect to prospect, evaluating resource potential and dialing in on areas that are economic. The oil and gas industry is a highly technical industry and the Niobrara Shale is complicated because of the lateral variability in the geology. Companies are working right now to meticulously drill and study their operations. They study the seismic data, drill bits, motors, geology, and test numerous variables in their drilling and completion techniques – working to unlock the resource. It could take years of testing methods and re-testing methods before a company finds out the perfect ‘recipe’ to unlock the resource.
SE Wyoming Niobrara vs PRB/Bakken
In comparison to other basins, like the Powder River Basin in Northeast Wyoming, the Niobrara Shale is complex. In the Powder River Basin operators could drill a well just about anywhere and get gas, due to the extensive shallow coal seams. In n the Powder River Basin, the shallow gas could be recovered economically – costing approximately $150,000 / rig. This compares to a cost of $5-6 million/rig in the Southeast Wyoming. At such a high cost, operators move forward carefully as they explore for oil.
In the Bakken Oil Field in North Dakota, oil was discovered in the 1950′s. It wasn’t until the 2000′s when the Bakken’s activity accelerated, due to a national economic downturn (low natural gas prices and high oil prices). New technology in drilling and completion techniques were also discovered around the same time, causing oil development to increase. This historical chart shows how long it took North Dakota companies to ‘figure out’ how to get the oil out of the ground – approximately 50 years!
Technology is ever-evolving
Thanks to new advances in technology, operators are hopeful it won’t take five decades to unlock the resource potential in Southeast Wyoming, but it is likely they will be in the exploration phase for 2-5 more years. No one really knows at this point – it is just a guess. Technology is evolving daily and as it evolves, the companies will learn new techniques to improve the possibility of recovering resources in complex geological regions like the Niobrara Shale. The ending result means energy dependence for the United States, jobs and a healthy economy.