A BRIEF HISTORY OF THE MIDDLE BAKKEN PLAY
FROM THE OPERATOR’S PERSPECTIVE:
Meridian, a/k/a Burlington (the railroad company) drilled many horizontal wells about 20 miles to the southeast of Elm Coulee Field in the 1980’s, targeting the Upper Bakken Shale. The results were poor overall, but they did not fracture stimulate (frac) the wells, and failed to notice that the better wells cut into the Middle Bakken porosity zone.
A company called Prospector, run by Dick Finley, drilled a Nisku test (below the Bakken) in the early 1990’s in Richland County, Montana. As was typically the case, they recovered good oil shows through the Bakken. But, Dick did some further research. An astute paper written by F. Meissner in 1978, generally identified a concept that Dick applied to a prospective area of about 150,000 acres containing an anomalous porosity development in the Middle Bakken zone. This zone had actually produced at high rates in three vertical well completions. Keying off that concept, the idea was born to test the Middle Bakken zone in Prospector's well.
At Elm Coulee, the Middle Bakken is a dolomite sandwiched between the Upper and Lower Shales. The shales are very rich in organic material, and the oil generated from them expanded from the shales upon reaching thermal maturity, migrating into the Middle Bakken zone.
Prospector presented this general concept to Lyco Energy Corporation in 1995. After researching the concept and developing a plan for evaluation, Lyco determined to take on the project in 1996, at the advice of Michael Lewis ("Mike"), president of Discovery. Shortly thereafter, Mike became the VP of Exploration and sole geologist for Lyco.
The plan involved acquiring about 50,000 acres and then re-entering 10 vertical dry holes, to test the Middle Bakken. Failing to re-enter on 3, the remaining 7 fracced vertical wells had mixed results, but it appeared that about 100,000 barrels could be expected, on average, from a vertical well completion. Oil was only about $15/barrel, so this was not particularly attractive at that time, and certainly did not justify the drilling of new vertical wells.
Nevertheless, Lyco proceeded to lease about 100,000 acres and move forward with a plan. Bobby Lyle (president of Lyco Energy) was determined to see this concept developed. Lyco researched horizontal drilling, finding only a couple of examples of successfully fracced horizontal wells, and went to work determining how this might be done in the Middle Bakken. The team of Michael Lewis (team leader and geologist), Charles Wiley (engineer) and Gary Dittmar (engineer) developed well designs and reservoir models that showed very high probability that the concept of horizontal drilling and fraccing would work in the Middle Bakken.
After two years trying to get funding (1997-1999) while oil was below $15/BO, Lyco finally convinced Halliburton that it would be commercially productive as it climbed through $18/BO. So, with Halliburton paying almost all of the cost for the first 12 test wells, and with Lyco as operator, Mike picked the first well location and the team drilled the first well in 1999 (the Burning Tree - State #36-10). With about 1,000' of horizontal borehole, the wellsite geologist (Roy Clements) recommended that the well be terminated early due to hole stability issues (it was supposed to have been a much longer lateral). After setting pipe and perforating at only 3 places over an 850’ interval along the horizontal, the well flowed at over 200 BOPD for quite some time, and even more after a frac. Lyco drilled over 250 well locations picked by Michael Lewis, all of which were successful, before selling for more than $400 Million in 2004. The play had begun!
The Geology of Unconventional Gas Plays: Michael Lewis, sponsored by the London Geological Society in London on 5 October, 2010
Transforming a Train Wreck…the Bakken Express: Michael Lewis, sponsored by SIPES in July 2007
Transforming a Train Wreck…the Bakken Express: Michael Lewis, sponsored by EMGI in June 2006
The Potential for Horizontally drilling the Middle Member of the Bakken Formation, North Dakota: Julie LeFever, for the 2005 Bakken Core Workshop
Diagenesis and Fracture Development in the Bakken Formation, Williston Basin: Implications for Reservoir Quality in the Middle Member: Janet Pitman, Leigh Price and Julie LeFever, for the USGS Professional Paper 1653 in 2001
Evolution of Oil Production in the Bakken Formation: Julie LeFever circa: 2004 for the Petroleum Council
Plays in Williston Basin Limited Only by Rig Supply: Beims in American Oil and Gas Reporter, August 2005
Three-Dimensional Reservoir Characterization of the Bakken Geologic System: DOE
Petroleum Geology of the Bakken Formation - Williston Basin, North Dakota and Montana: Fred Meissner paper, very astute and forward thinking, even predicting the Elm Coulee Field area, from the Economic Geology of the Williston Basin: The Montana Geological Society 24th Annual Conference, 1978 Williston Basin Symposium, p. 207-227
Elm Coulee Oil Field - Richland County, Montana: Bill Walker (Headington Oil Company), circa 2005
Improved Horizontal Well Stimulations in the Bakken Formation, Williston Basin, Montana: SPE 90697 - Wiley, Barree, Eberhard and Lantz
Bakken Horizontal Best Practices Review: Wiley, Everhard, Barree, Lantz, October 2004
The Bakken is Back: Peggy Williams paper from April 2004 OIl and Gas Investor