The extent of the Bakken Formation oil reserves and the speed at which they can be extracted will be the subject or many further announcements as they become better known and defined.  For now all we can say is that there seems to be a lot of recoverable oil there.   Let’s keep in mind that there is also a lot of recoverable oil in the Canadian and Venezuelan oil sands, but the maximum flow rates have proven and likely will continue to prove hard to increase rapidly.  There may not be similar technical and environment impediments for the Bakken.  We will see.  Here is one Bakkan story:

OUR OPINION: Bakken oil shows market’s true power

Tom Dennis [Email address: tdennis #AT# gfherald.com - replace #AT# with @ ] Grand Forks Herald
Published Sunday, April 13, 2008

We’re running out of oil.

Whale oil, that is.

And if an American prophet had said that in about 1850, he or she would have been right.

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But so what? In the early 1800s, the future wasn’t about whale oil, it turned out. Even though whaling was one of America’s biggest industries and most Americans lit their lamps with whale oil at night.

The future was about energy, hindsight shows. People responded to the high price of whale oil (among other indicators) by looking for substitutes. Lo and behold, those substitutes for turning night into day were found.

The same process continues today, as Thursday’s announcement about the Bakken Formation in North Dakota shows. That’s good news because it suggests humanity will avoid the modern version of the “running out of whale oil” scenario: “peak oil” predictions of a global energy collapse.

“North Dakota and Montana have an estimated 3.0 to 4.3 billion barrels of undiscovered, technically recoverable oil in an area known as the Bakken Formation,” the U.S. Geological Survey announced Thursday.

The agency’s assessment “shows a 25-fold increase in the amount of oil that can be recovered compared to the agency’s 1995 estimate of 151 million barrels of oil.”

Think about those two pieces of news. And remember a third item when you do: The USGS does not estimate how much oil actually is in a spot. It estimates how much is recoverable using today’s technology.

Thanks to advances in that technology, the agency’s estimates now show 25 times as much recoverable oil in the same place it had surveyed as recently as 1995.

Might similar advances make for another five-fold or 10-fold increase in the estimates in 2020? Or is this kind of progress now destined to stop?

Ugo Bardi, an Italian chemist and member of the Association for the Study of Peak Oil and Gas, is one of many who frets that yes, in fact, it may well stop. Crude oil basically is the end of the line: an energy source so (deceivingly) cheap and abundant that there basically are no substitutes, he suggests in a 2004 article in the newsletter “Energy Bulletin.”

True, maybe a substitute will materialize, as happened in the transition from whale oil to kerosene and beyond. Maybe.

“But if it does not materialize, we will have to live with depletion and, before long, begin to see lamps going out,” he concludes.

There’s often a sense of scolding in such pronouncements — a sense that humanity has squandered its inheritance and will get its comeuppance when the “lamps (start) going out” and we all go back to hunting, gathering or living on subsistence farms.

But such beliefs can act like blinders that keep the scold from seeing contrary evidence all around. Last week’s Bakken Formation news is one such piece of evidence. So is the mining of the tar sands in Canada. So are the prospects of wind power, tidal power, solar power, biofuels and “clean coal” and “coal to liquids” projects, among other developments.

And so is the ever-present possibility of nuclear power. Great Britain recently announced its determination to build new nuclear power plants in partnership with France.

These energy sources aren’t perfect; but then, neither is oil. What they are is reasonable. Tar sands mining and refining is an environmental nightmare, but Canada’s conscience is sure to bring about more regulation. That’s a policy question of the kind Canada and the U.S. have answered for years.

Meanwhile, all of this effort is being driven by an age-old formula: human ingenuity plus the astounding power of price. High prices drive people not only to find or make more of a good — oil, in this case — but also to come up with substitutes for it.

It happened before. And Ugo Bardi can relax, because it shows every sign of happening again.

Tags: peak oil energy investments

This entry was posted on Sunday, April 13th, 2008 at 8:40 pm and is filed under Bakken Formation, oil supply. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.