Bakken Formation - Largest Domestic Oil Discovery

[pjc]

PJC> I received this in my email box today. I had heard of it but, hadn't had time to verify. My guess is that the eco-extortionists will obstruct extraction because this great find does not align with the tenets of the new eco-religion of Climate Change.

Largest Domestic Oil Discovery, ... I Googled it myself today ... it's for real

This is amazing! Our elected leaders must be made to get off the dime and do something to free our country from middle east oil dependence. This looks very much like it can be done and why are they not doing something about it? I've sent this to my entire mailing list, hope it gets some of your attention. I hope you pass it on as well. Just maybe we 'The People' can get our elected officials to do something or replace them with people that will.

1. Ever heard of the Bakken Formation? GOOGLE it. I did, and again, BLEW my mind. The U.S. Geological Service issued a report in April ('08) that only scientists and oilmen/women knew was coming, but man was it big. It was a revised report (hadn't been updated since '95) on how much oil was in this area of the western 2/3 of North Dakota; western South Dakota; and extreme eastern Montana ... check THIS out:

The Bakken is the largest domestic oil discovery since Alaska's Prudhoe Bay, and has the potential to eliminate all American dependence on foreign oil. The Energy Information Administration (EIA) estimates it at 503 billion barrels. Even if just 10% of the oil is recoverable... at $107 a barrel, we're looking at a resource base worth more than $5.3 trillion.

'When I first briefed legislators on this, you could practically see their jaws hit the floor. They had no idea,' says Terry Johnson, the Montana Legislature's financial analyst.

'This sizable find is now the highest-producing onshore oil field found in the past 56 years,' reports The Pittsburgh Post Gazette. It's a formation known as the Williston Basin, but is more commonly referred to as the 'Bakken.' And it stretches from Northern Montana, through North Dakota and into Canada. For years, U.S.oil exploration has been considered a dead end. Even the 'Big Oil' companies gave up searching for major oil wells decades ago. However, a recent technological breakthrough has opened up the Bakken's massive reserves... and we now have access of up to 500 billion barrels. And because this is light, sweet oil, those billions of barrels will cost Americans just $16 PER BARREL!

That's enough crude to fully fuel the American economy for 41 years straight.

2. And if THAT didn't throw you on the floor, then this next one should - because it's from TWO YEARS AGO, people!

U.S.Oil Discovery - Largest Reserve in the World! Stansberry Report Online - 4/20/2006 - Hidden 1,000 feet beneath the surface of the Rocky Mountains lies the largest untapped oil reserve in the world is more than 2 TRILLION barrels. On August 8, 2005 President Bush mandated its extraction.

[(???) What the!??]

They reported this stunning news: We have more oil inside our borders, than all the other proven reserves on earth. Here are the official estimates:

- 8-times as much oil as Saudi Arabia
- 18-times as much oil as Iraq
- 21-times as much oil as Kuwait
- 22-times as much oil as Iran
- 500-times as much oil as Yemen- and it's all right here in the Western United States.

HOW can this BE!? HOW can we NOT BE extracting this!?
Because we've not D E M A N D E D Legislation to come out of Washington allowing its extraction, that's why!]

James Bartis, lead researcher with the study says we've got more oil in this very compact area than the entire Middle East - more than 2 TRILLION barrels. Untapped. That's more than all the proven oil reserves of crude oil in the world today, reports The Denver Post.
----
Don't think 'Big Oil' will drop its price - even with this find? Think again! It's all about the competitive marketplace, and if they can extract it (here) for less, they can afford to sell it for less - and if they DON'T, others will. It will come down - it has to.
----
Got your attention/ire up yet? Hope so! Now, while you're thinking about it... and hopefully PO'd, do this:

3. Take 5-10 minutes and compose an e-mail; fax or good old-fashioned letter to our elected officials in Washington... and their respected leaders. We'll start with them, and here's how you can send them your e-mail/fax, DEMANDING the immediate Legislation/an Energy PLAN that calls for tapping into these (OUR OWN!) Reserves, as well as allowing for the offshore drilling for OUR oil, in OUR offshore waters and Inter-continental shelf... not to mention Alaska. Technology isn't what it used to be people (ever had arthroscopic surgery?). They can surgically extract OUR oil, and get us on the way to at least some measure of Energy independence.

[HDRA1]

typical i swear have and cant do anything with it freaking eco nazis will stop it before it even starts or has that already happened

[TNT race photo]

I heard about this last year,I beleave this oil is embedded in rock,I didnt read your article but as I recall it will take 1000 pounds of rock to make one gal of gas,the greenies are comming out of the wood work in oposition to the the type of mining it would take to recover the oil.

[Chase 2]

[FONT=Arial Narrow][SIZE=3][B]PJC> I received this in my email box today. I had heard of it but, hadn't had time to verify. My guess is that the eco-extortionists will obstruct extraction because this great find does not align with the tenets of the new eco-religion of Climate Change.


There are no restrictions on drilling and production oil and gas in the Williston Basin and those who own leases are free to develop them. There has been on going deep (20,000ft +) exploration there since the early 1980's. There is nothing new in any of this. By the way, what makes the author think that these resources aren't being developed? Please feel free to show where the obstruction to the development of the Williston Basin is and who is causing it.

Just to correct the source, the region (Eastern Montana, Western North Dakota, and lower parts of Canada) is the Williston Basin, the rocks (formation) which hold the oil is is named the Bakken Shale.

Allow me to provide the conclusions from a paper written on the Bakken Shale from the blog "The Oil Drum":

Conclusions

1. The Bakken shale has produced about 111 million barrels of oil during the last 50+ years in Montana and North Dakota.

2. Total Bakken production is still rising, and producing at the rate of 75,000 BOPD in October 2007.

3. Because of the highly variable nature of shale reservoirs, the characteristics of the historical Bakken production, and the fact that per-well rates seem to have peaked, it seems unlikely that total Bakken production will exceed 2x to 3x current rate of 75,000 BOPD.

4. The latest boom in Bakken production is driven by the application of horizontal wells and hydraulic fracturing technology, which has added about 70 million barrels of production in 7 years. Ultimate recovery of the already-drilled wells should be at least double this volume.

5. The USGS estimates the mean volume of technically recoverable hydrocarbons to be 3,649 million barrels of oil. This is roughly 7 to 12 times the size of already known resources.

6. Based on current production and areas likely to be drilled, the USGS estimate of technically recovery resources seems optimistic.

7. The Bakken potential resource, while large by US onshore field standards, will have only a minor effect on US production or imports. Using 2006 US imports and consumption for comparison, the Bakken undiscovered resource of 3,649 million barrels of oil, if subsequently discovered and fully developed, would provide us with the equivalent of six months of oil consumption or 10 months of imports, spread over 20 or more years. In reality, the reserves developed are likely to be many times smaller than this value.

8. The October 2007 production rate of 75,000 BOPD amounts only 0.4% of US oil consumption, or 0.6% of imports.

9. Per-well Bakken production peaked in August 2005 at 116 barrels a day, and was down to 79 barrels a day in October 2007. If the Bakken production history in the 1990s can be used as a guide, the peaking of per-well production may portend a peak in total Bakken production.



U.S.Oil Discovery - Largest Reserve in the World! Stansberry Report Online - 4/20/2006 - Hidden 1,000 feet beneath the surface of the Rocky Mountains lies the largest untapped oil reserve in the world is more than 2 TRILLION barrels. On August 8, 2005 President Bush mandated its extraction...........................


The rest of what is posted is complete gobbly gook that is really just some sort of political rant based on vague references.

Here's a OIL DRUM link: http://www.theoildrum.com/node/3868
The discussion of porosity and permeability is a good one. The fact that there is oil in the ground doesn't mean you can extract it

[DSRacing]

U.S.Oil Discovery - Largest Reserve in the World! Stansberry Report Online - 4/20/2006 - Hidden 1,000 feet beneath the surface of the Rocky Mountains lies the largest untapped oil reserve in the world is more than 2 TRILLION barrels. On August 8, 2005 President Bush mandated its extraction.

[(???) What the!??]
[/SIZE][/FONT]
[FONT=Arial Narrow][SIZE=5][SIZE=3]They reported this stunning news: We have more oil inside our borders, than all the other proven reserves on earth. Here are the official estimates:

- 8-times as much oil as Saudi Arabia
- 18-times as much oil as Iraq
- 21-times as much oil as Kuwait
- 22-times as much oil as Iran
- 500-times as much oil as Yemen- and it's all right here in the Western United States.

HOW can this BE!? HOW can we NOT BE extracting this!?
Because we've not D E M A N D E D Legislation to come out of Washington allowing its extraction, that's why!]

James Bartis, lead researcher with the study says we've got more oil in this very compact area than the entire Middle East - more than 2 TRILLION barrels. Untapped. That's more than all the proven oil reserves of crude oil in the world today, reports The Denver Post.
----


pjc,

Where do you dig this stuff up?

The oil shale under the Rocky mountains will remain there for quite a while because the oil companies can't figure out an ecomonically viable way to extract it. What you have posted makes it sound like there is a huge pool of crude sitting under the rockies, which couldn't be further from the truth.

[pappawheely]

Union County approves zoning ordinance for Hyperion
By Dave Dreeszen (DaveDreeszen@siouxcityjournal.com) Journal business editor

ELK POINT, S.D. -- Flashing a smile, Joyce Bortscheller briefly hugged Hyperion Energy Center executive Preston Phillips as she greeted him in the backyard of her home here.

Bortscheller, president of the Elk Point City Council, had invited about 250 supporters to an outdoor barbecue Tuesday to await the returns for arguably the most important election in Union County's history. The big crowd didn't leave disappointed.

As midnight approached, they popped the champagne corks, celebrating a hard-fought victory that keeps alive the county's chances of landing the nation's first all-new oil refinery in 32 years.

By a solid 58 percent to 42 percent margin, county voters approved Hyperion's request to rezone 3,292 acres of farm land for a new classification, Energy Center Planned Development.

"What happened tonight, we were not supposed to be able to do," Phillips told a cheering audience. "Development projects like this are supposed to be outright rejected by residents and neighbors. But this project is a testament to our balancing the needs for growth and for protecting the environment."

At stake was billions of dollars in capital investment and thousands of high-paying jobs. From the beginning, Hyperion executives said they would abandon its Union County site, just north of Elk Point, if a majority of voters failed to give their blessing to the rezoning.

While conceding defeat, opponents vowed to keep fighting the controversial project on every imaginable front, pressing on with a lawsuit it filed against the county over the zoning procedures and opposing Hyperion as it applies for a bevy of state and federal permits.

"We have strategies in place to slow or delay all the permit processes," Ed Cable, chairman of the anti-Hyperion group Save Union County, said after the vote.

Tuesday's historic election culminated a months-long, emotionally charged campaign that pitted neighbor against neighbor in this extreme southeast South Dakota county.

Supporters cited the once-in-a-lifetime economic opportunities the $10 billion project would bring.

An average of 4,500 construction jobs would be required over four years. With the refinery up and running, Hyperion pledges to create 1,826 full-time jobs at hourly wages of between $20 and $30.

"I think it would be a great opportunity for young people to stay in this area instead of leaving for other states," Kelly Hoekstra, 31, of Dakota Dunes said after casting a vote in favor of the rezoning.

Opponents argued the massive development would not be worth the pollution and other troubles they claimed the refinery would bring. The health risks traditionally associated with a refinery weighed heavily on the minds of some voters.

"I live out here. I don't need the pollution," said Jim Schroeder of McCook Lake, after voting against the rezoning.

The contentious issue largely broke along urban and rural lines, with residents living the closest to the Hyperion site fighting the hardest to keep the refinery out of their backyards.

Tuesday's record turnout largely reflected that split, with early returns from the mostly rural precincts putting the "No" votes squarely in the lead. As votes were tallied in the more populated area, particularly in the southeast tier closest to Sioux City, that lead was slowly erased.

The ordinance took a slim 205-vote lead after 11 of the 13 precincts reported. Hyperion supporters declared victory after the Elk Point precinct results came in, increasing the rezoning lead by 150 votes.

Last to report was voter-rich Dakota Dunes, where an unusually large number of absentee ballots slowed the counting. In the Dunes, the ordinance easily passed, 1,017 to 236 votes.

"That's huge," Phillips told the cheering crowd.

The final tally was 3,932 votes in favor of the ordinance and 2,832 against.

Hyperion touted the so-called "green" technology in its proposed energy center, which it claims would be the world's cleanest. The refinery would process 400,000 barrels of tar sands crude a day from Alberta into low-sulfur gasoline, diesel and jet fuel.

Supporters argued that tapping into reserves from our neighbor to the north would reduce the nation's dependence on Mideast oil and add badly needed refining capacity in the U.S., where the last all-new refinery was built in 1976.

Both sides flooded the county's nearly 10,000 registered voters with paid ads, direct mailers and door-to-door stops, combining to raise and spend more than $100,000.

A ballot question committee formed by Dallas, Texas-based Hyperion alone poured in at least $45,000.

"It was close, and one of the reasons why was negative campaigning worked," Phillips told supporters. "We have always taken the high road, and we will continue to take the high road."

Hyperion project executive J.L. "Corky" Frank, a former Marathon Oil executive, joined Phillips for Tuesday night's celebration, where supporters enjoyed music, food and drink and regularly checked their cell phones for up-to-date election numbers.

Addressing the audience, Phillips thanked the local supporters, including Bortscheller and her husband, Gary, for hosting the party.

Last summer, after Hyperion publicly announced its interest in the Union County site, Bortscheller, who is also a local economic development leader, organized a barbecue for Hyperion CEO Albert Huddleston to introduce him to local residents.

"From the very beginning I was on board because I felt it was the right thing for our county," Bortscheller said early in the evening.

Journal staff writer Michele Linck (MicheleLinck@siouxcityjournal.com) contributed to this story.

[pappawheely]

SPE Updates Home (http://updates.spe.org/)
Oil-shale extraction technology has a new owner

1 February 2008 in US/Canada (http://updates.spe.org/index.php/category/regional/us-canada/), Facilities (PFC) (http://updates.spe.org/index.php/category/disciplines/pfc/), HSE (http://updates.spe.org/index.php/category/disciplines/hse/), Production (PO) (http://updates.spe.org/index.php/category/disciplines/po/)
As a long-term petroleum source, oil-shale reserves are vast but remain elusive. Oil-services giant Schlumberger is aiming to change that with the recent purchase of a radio-frequency (RF)/critical-fluid (CF) extraction technology that unlocks this vast resource and brings it to the surface in a cost-effective and environmentally sound manner.

Oil shale is a type of sedimentary rock that contains solid bituminous material, known as kerogen, that releases oil or gas when heated. While oil-shale deposits are found in many places around the world, the largest deposits by far reside in the Rocky Mountain region of the U.S. Oil-shale reserves are estimated at nearly 2 trillion bbl in the states of Colorado, Utah and Wyoming alone (http://fossil.energy.gov/programs/reserves/npr/Oil_Shale_Resource_Fact_Sheet.pdf), according to the U.S. Department of Energy. This quantity would be sufficient to meet U.S. demand at current levels for the next 250 years.
However, successfully harvesting this vast resource has been technically, economically, and environmentally challenging. The most common methods of recovering oil shale include a mining step, in which the shale is mined from the surface or underground and then transported to a facility for further processing. The waxy, solid nature of the shale necessitates a heating process, known as retorting, to release the trapped oil and allow it to flow out of the rock matrix.
The large environmental and processing costs associated with this method of oil-shale extraction have prevented it from becoming a major petroleum source. According to an Environmental Impact Statement (EIS) (http://ostseis.anl.gov/guide/oilshale/index.cfm) prepared by the U.S. Department of the Interior's Bureau of Land Management, the environmental impacts include emission of greenhouse gases during mining and processing, disturbance of mined lands, need for disposal of the spent shale, use of water resources, and impacts on air and water quality. These factors contribute to the relatively high cost of producing oil from shale, which the EIS estimates at greater than USD60/bbl.
http://updates.spe.org/wp-content/uploads/2008/02/raytheon-rf-cf-web.jpg (http://updates.spe.org/wp-content/uploads/2008/02/raytheon-rf-cf-web.jpg)The RF/CF extraction technology developed by Raytheon and technology partner CF Technologies aims to lower these environmental and processing impacts dramatically by employing an in-situ retorting process. In this process, wells are drilled into the shale strata using standard drilling equipment. Raytheon's RF transmitters (which have been used extensively for radar and guidance systems) are then lowered into the well. The transmitters emit a radio signal at a frequency that uniformly heats the shale and liquefies the trapped petroleum.
Supercritical carbon dioxide is then pumped into the heated shale formation to extract the oil from the rock and carry it to a producing well. At the surface, the carbon dioxide is separated from the oil, reprocessed, and pumped back into the injection wells. The recovered oil is sent for further processing and refining.
Raytheon estimates that this combination of RF technology to heat the shale followed by a critical-fluid flush to bring the oil to the surface will result in significant environmental benefits and cost savings over other shale-extraction methods. The technology can retrieve 4 to 5 bbl of oil for every barrel consumed during the extraction process, while other in-situ retorting processes reportedly extract only 1.5 to 3 bbl for every barrel consumed.
In addition, the RF/CF technology enables extraction to start 1 to 2 months after the transmitters are activated. Other in-situ methods using in-ground electrical heating systems may take 2 to 3 years to heat the shale sufficiently for oil to flow.
The sale to Schlumberger promises to open up new application areas for this technology and is part of a Raytheon initiative to expand its RF and communication-systems technologies to a customer base outside of the security and defense arenas. Four years ago, Raytheon created the Mission Innovation group within its Integrated Defense Systems (IDS) division, which had a goal of focusing mature defense capabilities to address challenges in energy exploration and the environment.
"Schlumberger is the world leader in bringing new technology to the field for the exploration and production of oil," said Lee Silvestre, vice president of the Mission Innovation group of Raytheon IDS. "Its acquisition of this technology is an important milestone in Raytheon's approach to applying proven technology that can unlock potential in adjacent markets."
To learn more about this oil-extraction technology, contact Raytheon (http://www.raytheon.com/contact/).
http://updates.spe.org/wp-content/uploads/2008/02/raytheon-field-web.jpg (http://updates.spe.org/wp-content/uploads/2008/02/raytheon-field-web.jpg)
Ted Moon is the Technology Editor of JPT Online. He brings information on emerging technologies, R&D successes, new field applications, updates from SPE papers about recent innovations, and more. If you have a question or suggestion for future article topics, email Ted at teched@spe.org.


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[Ziggy]

http://www.usgs.gov/newsroom/article.asp?ID=1911

This will be the way of the future I am thinking.

[pjc]

pjc,

Where do you dig this stuff up?


As mentioned, a friend sent it to me, then an industry associate in Iowa took interest.


The oil shale under the Rocky mountains will remain there for quite a while because the oil companies can't figure out an ecomonically viable way to extract it. What you have posted makes it sound like there is a huge pool of crude sitting under the rockies, which couldn't be further from the truth.

Yep, that's what it sounds like but, this is not the Rockies. It is well east of the Rockies.

I am on vacation right now and will dig around to see if I can find info that compares, agrees or disputes with Chase 2's and will report back when I have free time.

[DSRacing]

As mentioned, a friend sent it to me, then an industry associate in Iowa took interest.



Yep, that's what it sounds like but, this is not the Rockies. It is well east of the Rockies.

Here's a map of the shale oil deposits located in Utah, Colorado and Wyoming. Sure looks like the Rocky mountains to me.

http://ostseis.anl.gov/guide/maps/index.cfm

A couple more articles regarding the Green river oil shale deposits,

http://www.futurepundit.com/archives/002981.html

http://www.rand.org/pubs/monographs/2005/RAND_MG414.sum.pdf

[EQuin]

According to this Wikipedia article, the Bakken Formation is actually in North Dakota, Montana and Saskatchewan, not in Utah, Colorado and Wyoming:

http://en.wikipedia.org/wiki/Bakken_Formation

The Wikipedia info goes on to say that it is actually not shale oil (kerogen) like what is found in parts of Colorado, Utah and Wyoming because the oil lies beneath a layer of shale:

"As the oil is beneath the shale rather than in it, these reservoirs are not considered oil shale."

Although the Wikipedia info cites a few sources that claim estimates of around 500 billion barrels (by contrast, ANWR reserves are estimated at only 5 to 15 billion barrels), the latest source cited in that Wikipedia article estimates the Bakken Formation to hold about 167 billion barrels - still astronomically huge compared to the ANWR reserves.

The problem, as noted in the Wikipedia link, is that it is still technically difficult to extract the oil. The Wikipedia link goes on to say:

"While these numbers would appear to indicate a massive reserve, the percentage of this oil which might be extracted using current technology is another matter. Estimates of the Bakken's technically recoverable oil have ranged from as low as 1% — because the Bakken shale has low porosity, making the oil difficult to extract — to Leigh Price's estimate of 50% recoverable.[10] Reports issued by both the USGS and the state of North Dakota in April 2008 seem to indicate the lower range of recoverable estimates are more realistic with current technology."

So in short, yes, it appears that the Bakken Formation contains a huge amount of oil if estimated reserves are correct, but unfortunately, current technology makes its extraction rather tenable.

[DSRacing]

U.S.Oil Discovery - Largest Reserve in the World! Stansberry Report Online - 4/20/2006 - Hidden 1,000 feet beneath the surface of the Rocky Mountains lies the largest untapped oil reserve in the world is more than 2 TRILLION barrels. On August 8, 2005 President Bush mandated its extraction.

[(???) What the!??]
[/SIZE][/FONT]
[FONT=Arial Narrow][SIZE=5][SIZE=3]They reported this stunning news: We have more oil inside our borders, than all the other proven reserves on earth. Here are the official estimates:

- 8-times as much oil as Saudi Arabia
- 18-times as much oil as Iraq
- 21-times as much oil as Kuwait
- 22-times as much oil as Iran
- 500-times as much oil as Yemen- and it's all right here in the Western United States.

HOW can this BE!? HOW can we NOT BE extracting this!?
Because we've not D E M A N D E D Legislation to come out of Washington allowing its extraction, that's why!]

James Bartis, lead researcher with the study says we've got more oil in this very compact area than the entire Middle East - more than 2 TRILLION barrels. Untapped. That's more than all the proven oil reserves of crude oil in the world today, reports The Denver Post.

This part of pjc's post is information is referencing the Green River Formation in Utah, and has nothing to do with the Bakken Formation in the Dakotas. I'm well aware of that.

http://en.wikipedia.org/wiki/Green_River_Formation

[EQuin]

This part of pjc's post is information is referencing the Green River Formation in Utah, and has nothing to do with the Bakken Formation in the Dakotas. I'm well aware of that.

http://en.wikipedia.org/wiki/Green_River_Formation

Ah, gotcha. And yes, many have known that we have a whole bunch of oil shale, but the problem is extracting it. If Shell Oil's new, in-situ extraction technology pans out, then we'll be in business....

[Ziggy]

http://www.billingsgazette.net/articles/2008/07/15/news/state/59-bakken.txt

Does not look like its brain surgery to get at this oil.This guy became a millionaire in a year on one well.;);)

[Chase 2]

http://www.billingsgazette.net/articles/2008/07/15/news/state/59-bakken.txt

Does not look like its brain surgery to get at this oil.This guy became a millionaire in a year on one well.;);)

"We got enough now to buy new stuff," Lorene said, "but we like our old stuff."

[Ziggy]

http://www.billingsgazette.net/articles/2008/07/20/news/state/18-bakkenoil.txt



It may be expensive but as he says at $129 a barrel its well (pardon the pun) worth it.


Just another backseat spectator posting second hand info.

[Ziggy]

http://www.billingsgazette.net/articles/2008/07/20/news/state/16-oilpumping.txt



Headlines in the Billings paper today.People are starting to pay attention.My best friend just leased his 20,000 sq ft warehouse to a company who got a contract to build 9,000 oil holding tanks.
Something's happenin'.

[pappawheely]

Arctic May Hold 90 Billion Barrels of Oil, U.S. Says (Update2)

By Joe Carroll
July 23 (Bloomberg) -- The Arctic may hold 90 billion barrels of oil, more than all the known reserves of Nigeria, Kazakhstan and Mexico combined, and enough to supply U.S. demand for 12 years, the U.S. Geological Survey said.
One-third of the undiscovered oil is in Alaskan territory, the agency found in a study (http://pubs.usgs.gov/fs/2008/3049/fs2008-3049.pdf) released today. By contrast, a geologic formation beneath the North Pole claimed by Russian scientists last year probably holds just 1.2 percent of the Arctic's crude, the U.S. report showed.
Energy producers such as Royal Dutch Shell Plc (http://www.bloomberg.com/apps/quote?ticker=RDSA%3ALN) and Chevron Corp. (http://www.bloomberg.com/apps/quote?ticker=CVX%3AUS) have accelerated exploration of the northernmost regions for untapped reserves amid record prices and receding access to deposits in more hospitable climates. Russia's move to scrap a United Nations convention and carve out an exclusive Arctic zone sparked protests from Canada, the U.S., Norway and Denmark.
``Most of the Arctic, especially offshore, is essentially unexplored with respect to petroleum,'' Donald Gautier, the project chief for the assessment, said in the report. ``The extensive Arctic continental shelves may constitute the geographically largest unexplored prospective area for petroleum remaining on Earth.''
Russia dispatched a nuclear-powered icebreaker to the Arctic Ocean last year to map a subsea link between Siberia and the North Pole as part of a bid to refute a UN convention limiting resource claims beyond 200 miles (321 kilometers) offshore. Canada said earlier this month that it plans to counter the Russian overture with ``a very strong claim'' to Arctic exploration rights.
No Time Estimate
The U.S. report didn't include an estimate for how long it will take to bring the reserves to markets. Offshore fields in the Gulf of Mexico and West Africa can take a decade or longer to begin pumping oil.
The geologists studied maps of subterranean rock formations across the 8.2 million square miles above the Arctic Circle to find areas with characteristics similar to oil and gas finds in other parts of the world.
The study also took into account the age, depth and shape of rock formations in judging whether they are likely to contain oil, Gautier said today during a conference call with reporters. Seismic data doesn't yet exist for most of the Arctic, he said.
``Petroleum doesn't just occur anywhere,'' Gautier said. ``It requires a very narrow set of burial conditions.''
U.S. oil executives such as Exxon Mobil Corp.'s Rex Tillerson (http://search.bloomberg.com/search?q=Rex%0ATillerson&site=wnews&client=wnews&proxystylesheet=wnews&output=xml_no_dtd&ie=UTF-8&oe=UTF-8&filter=p&getfields=wnnis&sort=date:D:S:d1) and Chevron Corp.'s David O'Reilly (http://search.bloomberg.com/search?q=David+O%26%2339%3BReilly&site=wnews&client=wnews&proxystylesheet=wnews&output=xml_no_dtd&ie=UTF-8&oe=UTF-8&filter=p&getfields=wnnis&sort=date:D:S:d1) have urged lawmakers to relax prohibitions against offshore drilling, including much of Alaska. Democratic leaders in both houses of Congress rejected President George W. Bush (http://search.bloomberg.com/search?q=George+W.+Bush&site=wnews&client=wnews&proxystylesheet=wnews&output=xml_no_dtd&ie=UTF-8&oe=UTF-8&filter=p&getfields=wnnis&sort=date:D:S:d1)'s July 14 effort to end a 25-year moratorium on drilling in most coastal waters.
West Siberia Basin
The region above the Arctic Circle also holds an estimated 1,669 trillion cubic feet of natural gas, equal to 27 percent of the world's known gas reserves, the study showed. Almost 40 percent of the gas reserves are in Russia's West Siberia Basin.
About 84 percent of the oil and gas reserves probably lie offshore, the report showed. The region also has an estimated 44 billion barrels of natural-gas-liquids such as propane and butane, which are used by chemical producers, oil refiners and for home heating.
The study encompassed all areas north of 66.56 degrees north latitude and only included reserves that could be tapped using existing techniques. Experimental or unconventional prospects such as oil shale, gas hydrates and coal-bed methane weren't included in the assessment.
Data Contributors
Contributors of data to the study included the Geological Survey of Canada, the U.S. Interior Department's Minerals Management Service, the Norwegian Petroleum Directorate, the Cambridge Arctic Shelf Program and researchers in Denmark and Greenland. No Russian institutions took part in the study.
The survey only applied to undiscovered reserves. Exxon Mobil, Shell, Gazprom OAO and other energy producers have already found 400 oil and gas fields that hold the equivalent of 240 billion barrels. On a combined basis, the undiscovered reserves of oil and gas in today's report amount to 412 billion barrels.
Most of those discoveries remain capped because of a lack of pipeline or shipping facilities to haul the petroleum to markets.
Crude for September delivery fell $3.98, or 3.1 percent, to $124.44 a barrel at 2:59 p.m. on the New York Mercantile Exchange. Oil climbed 66 percent in the past year on its way to a record $147.27 a barrel on July 11.
Global Demand
Global crude demand is expected to rise by 1 percent this year to 86.85 million barrels a day, after a 1.3 percent increase in 2007, the International Energy Agency said in a July 10 report.
Kazakhstan, site of the world's two biggest oil discoveries of the past three decades, has 39.8 billion barrels of crude reserves, according to London-based BP Plc. Nigeria's reserves amount to 36.2 billion barrels and Mexico holds 12.2 billion. Russia, the world's largest producer last year, has 79.4 billion barrels of oil reserves and 1,577 trillion cubic feet of gas.
The U.S. is expected to use about 7.39 billion barrels of crude this year, according to the Paris-based IEA.
To contact the reporter on this story: Joe Carroll (http://search.bloomberg.com/search?q=Joe+Carroll&site=wnews&client=wnews&proxystylesheet=wnews&output=xml_no_dtd&ie=UTF-8&oe=UTF-8&filter=p&getfields=wnnis&sort=date:D:S:d1) in Chicago at jcarroll8@bloomberg.net