New shale formation in West Texas could dwarf the Bakken
The US shale boom has led some to predict that it will overtake Saudi Arabia as world’s largest oil and gas producer by 2020, thanks to the massive reserves found in plays such as the Bakken Shale of North Dakota, the Marcellus Shale in New York, and the Eagle Ford Shale in Texas; even the newly discovered Tuscaloosa Shale formation in Louisiana holds large potential.
However there is a new shale formation that has been discovered in West Texas which could dwarf all others being drilled in the US at the moment.
The play is known as the Cline Shale play and has been discovered in the Permian Basin.
John Breyer a geologist at Marathon Oil Corp.(NYES: MRO) said that this new discovery could dwarf anything that exists in North Dakota. Ken Morgan, the director of the Texas Christian University Energy Institute, stated that, “It’s like the Eagle Ford on steroids. They haven't even begun. We're just in the toe of this thing.”
Both Devon Energy Corp. (NYSE: DVN) and Chesapeake Energy Corp. (NYSE: CHK)have reported exciting results from exploratory drills in the region. Devon’s tests showed that around 3.6 million barrels of oil could be recovered per square mile, and as the Cline formation covers roughly 9,800 square miles it gives an estimated reserve of more than 30 billion barrels. A fair bit more than the 4.3 billion in the Bakken, or the 3 billion barrels in the Eagle Ford plays.
By Charles Kennedy, Oilprice.com