Bakken Formation Oil Assessment in North Dakota, Montana will be updated by U.S. Geological Survey

WASHINGTON, DC – Secretary of the Interior Ken Salazar today announced that the U.S. Geological Survey will update its 2008 estimate of undiscovered, technically recoverable oil and gas in the U.S. portion of the Bakken Formation, an important domestic petroleum resource located in North Dakota and Montana.

“The Administration supports safe and responsible oil and gas production as part of our nation's comprehensive energy portfolio,” Salazar said. “We must develop our resources armed with the best science available, and with wells drilled in the Bakken during the past three years, there is significant new geological information. With ever-advancing production technologies, this could mean more oil could potentially be recovered in the formation.”

The 2008 USGS assessment estimated 3.0 to 4.3 billion barrels of undiscovered, technically recoverable oil in the U.S. portion of the Bakken Formation, elevating it to a “world-class” accumulation. The estimate had a mean value of 3.65 billion barrels. The USGS routinely conducts updates to oil and gas assessments when significant new information is available, such as new understanding of a resource basin's geology or when advances in technology occur for drilling and production.

The 2008 Bakken Formation estimate was larger than all other current USGS oil assessments of the lower 48 states and is the largest "continuous" oil accumulation ever assessed by the USGS. A "continuous” or "unconventional" oil accumulation means that the oil resource is dispersed throughout a geologic formation rather than existing as discrete, localized occurrences, such as those in conventional accumulations. Unconventional resources require special technical drilling and recovery methods.

“The new scientific information presented to us from technical experts clearly warrants a new resource assessment of the Bakken,” said USGS Energy Resources Program Coordinator Brenda Pierce. “The new information is significant enough for the evaluation to begin sooner than it normally would. It is important to look at this resource and its potential contribution to the national energy portfolio.”

The 2008 USGS assessment showed a 25-fold increase in the amount of technically recoverable oil as compared to the agency's 1995 estimate of 151 million barrels of oil. New geologic models applied to the Bakken Formation, advances in drilling and production technologies, and additional oil discoveries resulted in these substantially larger technically recoverable oil volumes. About 135 million barrels of oil were produced from the Bakken between 1953 and 2008; 36 million barrels in 2008 alone. According to state statistics, oil production from the Bakken in North Dakota has steadily increased from about 28 million barrels in 2008, to 50 million barrels in 2009 to approximately 86 million barrels in 2010.

“The Bakken Formation is producing an ever-increasing amount of oil for domestic consumption while providing increasing royalty revenues to American Indian tribes and individual Indian mineral owners in North Dakota and Montana,” Salazar noted. Interior agencies have been working closely, for example, with the Three Affiliated Tribes (the Mandan, Hidatsa and Arikara) and individual Indian mineral owners on the Ft. Berthold Reservation in North Dakota to facilitate this development.

Technically recoverable oil resources are those producible using currently available technology and industry practices. USGS is the only provider of publicly available estimates of undiscovered technically recoverable oil and gas resources.

The new update effort will be a standard assessment task under the existing USGS National Oil and Gas Assessment. It will begin in October 2011, at the start of the 2012 fiscal year. Depending on funding, it is expected to take two years to complete. Drilling and production will continue while the USGS conducts its assessment update.

For more information about the Bakken Formation, please visit the USGS frequently asked questions that were developed after the 2008 resource assessment at http://www.usgs.gov/faq/index.php?action=show&cat=21