Tuesday, June 05, 2012

Shale Play in Siberia 80X Bigger than Bakken

OilPrice.com -- "The Bakken shale play is one of the biggest in the U.S., but is absolutely dwarfed by a shale play in Russia. The Bazhenov is located in Western Siberia, and according to Oswals Clint, Sanford Bernstein’s lead international oil analyst, it “covers 2.3 million square kilometers or 570 million acres, which is the size of Texas and the Gulf of Mexico combined;” an area 80 times bigger than the Bakken.

News of the Bazhenov may be new to many of us, but geologists have actually been studying it for at least 20 years, however it is only in the last few years that the technology and expertise necessary to drill the oil has been developed.

ExxonMobil and Statoil have agreed to start joint venture operations in the region with the Russian, state-owned Rosneft in an attempt to secure access to the Bazhenov. Exxon made a recent statement which confirmed the agreement “to jointly develop tight oil production technologies in Western Siberia.”

9 Comments:

At 6/06/2012 5:27 AM, Blogger Larry G said...

I'm not surprised - at all. It was/is hard to believe that ONLY the US has such resources.

 
At 6/06/2012 7:23 AM, Blogger VangelV said...

I'm not surprised - at all. It was/is hard to believe that ONLY the US has such resources.

What we need are reserves, not resources.

 
At 6/06/2012 7:54 AM, Blogger Jon Murphy said...

I'm not surprised - at all. It was/is hard to believe that ONLY the US has such resources.

Siberia has always had major oil fields. The problem has been access. Siberia is not, hall we say, developed. Plus, being the coldest place in the world, machinery can become very brittle.

 
At 6/06/2012 8:53 AM, Blogger Larry G said...

Well, as others have surmised... at SOME POINT - those other resources become viable reserves.... right?

I just think that (until disproven) that these resources are pretty much distributed on a world-wide basis (as opposed to ONLY certain places like the US).

And as Jon points out.. it's HOW you access and deliver those resources that is the real issue - i.e. moving/transporting remote resources is uneconomic as long as "near" resources are available.

the longer term question is - once we are having to go after the "far" resources - how will they compete in cost to alternative fuels or more efficient use?

Will we ever really "run out" of fossil fuels or will they just become uneconomic compared to other alternatives?

You could have a "strike" 80x bigger than Bakken - but what does that REALLY MEAN in terms of "proven reserves"?

 
At 6/06/2012 9:00 AM, Blogger Jon Murphy said...

the longer term question is - once we are having to go after the "far" resources - how will they compete in cost to alternative fuels or more efficient use?

That is a good point, Larry. But, since we are talking about the long term, infrastructure may not be an issue. If these reserves become economically viable to drill, the infrastructure will (likely) follow. Assuming, of course, someone believes the return on investment is great enough.

 
At 6/06/2012 9:12 AM, Blogger VangelV said...


Well, as others have surmised... at SOME POINT - those other resources become viable reserves.... right?


Not at all. There are thousands of companies that were never able to turn resources into reserves because the process was not economic.

 
At 6/06/2012 11:12 AM, Blogger Unknown said...

@Jon,

This area of Siberia is already very well-developed with oil infrastructure and cities and towns. It's the same area of west Siberia where most of Russia's oil production has historically come from.

Rosneft has already estimated 18 billion barrels on its holdings in the area.

 
At 6/06/2012 11:29 AM, Blogger Its GSATT said...

I like the sound of it, Let the speculating continue please.

 
At 6/06/2012 12:21 PM, Blogger Jon Murphy said...

This area of Siberia is already very well-developed with oil infrastructure and cities and towns. It's the same area of west Siberia where most of Russia's oil production has historically come from.

Well, then, I stand corrected.

 

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