Tuesday, October 05, 2010
Evergreen, Colo.-based BENTEK Energy reports that horizontal drilling and hydraulic fracturing, which has revolutionized U.S. shale gas production and other unconventional plays, is also transforming the domestic crude oil industry. As a result, U.S. oil production is on the rise for the first time in 23 years.
In its new report, The Rush to Unconventional Oil, BENTEK notes that technologies are being used to unlock oil from shales in a number of plays such as the Bakken and Niobrara shales in the Rockies region, the Bone Springs/Wolfberry, Granite Wash and Eagle Ford plays in and around Texas and the liquids-rich shales in the southwestern Marcellus.
"These are extremely important developments for U.S. crude oil production," said E. Russell Brazil, BENTEK Energy managing director. "The growth trend in unconventional oil looks strikingly similar to what we saw in the early stages of natural gas shale production. And the development is being driven by attractive oil prices, which remain high relative to natural gas.
"This has provided the economic incentive for many players in the upstream industry to turn to more oil-dominated exploration opportunities to realize higher returns for their drilling investment dollars."
The transfer of shale drilling techniques from gas to oil has the further potential to increase revenue for producers. Not only will producers benefit from the revenue gains from adding oil and liquids to the production, they also will reap the advantages of drilling efficiencies that hold the promise of lower costs and higher production yields, BENTEK noted in its report.
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