The rapid expansion of shale drilling since 2004 has resulted in the coining of terms that imply immediate success: references to a “gale” or a “boom” come to mind. But the shale success story seems more like a string of gunfire that happened incrementally over time as oil and gas prices fluctuated and technology advanced. At least that’s the case in The American Shales, which chronicles the history of shale exploration in the United States.
The book, which was written by Oil and Gas Investor’s editor-at-large Nissa Darbonne, taps a small army of sources, such as now-deceased George Mitchell, whose light sand frac revolutionized development of the Barnett shale, and Bobby Lyle, who first used horizontal drilling to exploit the Middle Bakken, and many other lesser-known but key players in North American shale development. The comprehensive read details the big deals, the technology and the long odds championed not by large IOCs, but by independent companies such as Devon Energy Corp. (NYSE: DVN) and Chesapeake Energy Corp. (NYSE: CHK).
“When I was at Chevron, we had a guy come through the overseas business (unit),” geologist Kent Bowker, who left Chevron Corp. (NYSE: CVX) to work for Mitchell in 1997, Darbonne writes. “He actually told us he felt sorry that we had to try and find oil and gas in the United States because it was obvious that there really wasn’t anything left. He said we could work overseas, instead, and do exciting projects. Now, the rest of the world is trying to emulate what we’ve done here in the United States.”
But what’s been done in the United States didn’t happen overnight. After the success of light sand fracs in the Cotton Valley, Mitchell tried it out in vertical Barnett wells in 1997, making the play more economic.Meanwhile in the Williston Basin, where, in 1996, many thought production had already peaked, Lyle contrived a way to horizontally test the middle-Bakken layer in Montana. But proving the giant oil field moved sluggishly because of lowering oil prices, and the Bakken had to wait until 2000.
In addition, the book adds color to the key shale players’ personalities, noting their work histories and education. The author has also handily provided historical context dating back to 1946, helping the reader to understand how petroleum came to be the most powerful commodity in the post-war West. It’s a useful tool for the professional in energy, and engaging enough for a more general audience.
Perhaps most interestingly, the book also shows the long odds shale developers faced in the pre-shale-boom era. Mitchell stuck it out in the face of low prices while geologists and engineers told him he was wasting his time. The middle Bakken zone that Lyle drilled was only 10 to 15 feet thick. And though the Marcellus had good shows, when Range first drilled through it the company ignored it initially, because the well was targeting formations below the Marcellus. With some innovative thinking, creative deal-making and marathon work sessions, the whiff of grapeshot transformed into the boom we know today.
For more information about the book and its availability date, see TheAmericanShales.com.
Recommended Reading
Oil and Gas Chain Reaction: E&P M&A Begets OFS Consolidation
2024-04-26 - Record-breaking E&P consolidation is rippling into oilfield services, with much more M&A on the way.
Exxon Mobil, Chevron See Profits Fall in 1Q Earnings
2024-04-26 - Chevron and Exxon Mobil are feeling the pinch of weak energy prices, particularly natural gas, and fuels margins that have cooled in the last year.
73-year Wildcatter Herbert Hunt, 95, Passes Away
2024-04-12 - Industry leader Herbert Hunt was instrumental in dual-lateral development, opening the North Sea to oil and gas development and discovering Libya’s Sarir Field.
EOG Resources Wildcatting Veteran Billy Helms to Retire
2024-04-02 - Joining an EOG Resources predecessor in 1981, Helms is among the pre-1986-oil-bust generation who later found success in shale.
E&P Earnings Season Proves Up Stronger Efficiencies, Profits
2024-04-04 - The 2024 outlook for E&Ps largely surprises to the upside with conservative budgets and steady volumes.