A while ago Forbes ran an article on Unconventional Oilfields, asking where the next Bakken is.
The Bakken is a big deal. It may produce more than 1 million barrels per day later this year. And perhaps 24 billion barrels could be produced over its lifetime.
But the Bazhenov is in a different league. It’s BIG. Sanford Bernstein estimate that it covers 2.3 million square kilometres (570 million acres). That’s about the size of Texas and GoM combined. And that makes it about 80 times larger than the Bakken.
Wood Mackenzie estimates the Bazhenov holds 2 trillion barrels of in place oil. That’s 5 times that of the Bakken. Many see this as conservative. The overt optimists point to significantly larger numbers, perhaps as much as 1 trillion barrels recoverable (an almost unbelievably large number).
The downside is that it’s in Western Siberia. Hello Mr. Putin. Hello political and surface issues.
So far, the technology isn’t working entirely smoothly in the Upper Jurassic Bazhenov. There are some tough issues, not least the Siberian environment. Lukoil, who are experimenting with the area, have production of just 2000 barrels a day from the Bazhenov, from pay zones averaging 30m (100ft) in thickness. However, the crude from the Bazhenov is said to be very light, rich, and clean, with quality broadly equivalent to Brent crude.
But it’s early days. This is no time for Texan arrogance or an assumption that unconventionals only work in the US. The Russians are smart, well educated, and motivated. They will, eventually, get this right
Besides, Exxon is helping the Russians learn how to do it. Exxon and Rosneft started a joint venture in 2011 to explore an area of the Bazhenov they think holds 13.2 billion barrels of recoverable oil. As part of the deal Rosneft took a 30% stake in a tight oil project to gain experience in the technology. Others are also trying. TNK-BP and Gazprom Neft are both planning wells in the Krasnoleninskoye (Red Lenin) field using fracking technology. Shell has a partnership with Gazprom Neft at their Salym joint venture.
Russia is already the world’s #1 producer. Expect more of the same.