Story by the Bismarck Tribune
Strike a 500-mile-long line due south from Williston (along the 103rd west meridian), and you’ll eventually light in an area that is a near mirror-image of Bakken country. Just a few dozen or so miles east of the Rocky Mountain Front, the prairies of eastern Colorado, western Nebraska and Kansas, and southeastern Wyoming are home to an oil and gas play that has all of the earmarks of the Bakken, including technology, infrastructure and the companies punching holes. The play is called the Niobrara and it is so much like the Bakken that it’s been tagged with the moniker “NeoBakken.”
The Niobrara is one of North America’s most extensive geologic formations. It underlies much of the American Great Plains, Rocky Mountain basins and northward into the Canadian prairies. In fact, if you’re standing anywhere in North Dakota west of the Red River Valley, the Niobrara is somewhere under foot. Unlike the Bakken, however, the Niobrara is actually exposed at the surface, primarily in a thin belt from Cavalier County in the north to Sargent and Dickey Counties in the south. Whisk away the overlying glacial debris here and there, and you can easily see and touch the Niobrara.
The Bakken was more than a quarter billion years old when the Niobrara was deposited between 87 million and 82 million years ago. Geologists call that period the “Cretaceous” (Latin for “chalky”). At that time, North America was split by the Western Interior Seaway, which extended from what is now the Arctic Ocean to the Caribbean. The seaway endured for some 40 million years and reached depths of 2,500 feet and a width of up to six hundred miles.
In those days, what is now North America was much closer to the Equator, so the Seaway teemed with subtropical marine life ranging from microscopic plants and animals to sharks and mosasaurs (giant marine reptiles). While the eastern region of the Seaway bordering the Appalachians was relatively quiet, the western area received a near-continuous supply of sediments being washed in from the highlands to the west in what would later become the Rockies. The microscopic marine life mixing with sediments and rising and falling sea level was the perfect recipe for the formation of oil and natural gas – right out of a Geology 101 textbook.
Current oil and gas activity in the Niobrara is centered in the Denver-Julesburg Basin, a deep geologic structure that underlies eastern Colorado and adjacent parts of Wyoming, Kansas, and Nebraska. The basin is nestled against the Rockies to the west. The City of Denver is situated above its thickest point – some 14,000 feet, which is comparable to the Williston Basin’s thickest point in northwestern North Dakota.
The Niobrara (sometimes called the Niobrara shale) is made up of two general units. The Fort Hays limestone (including shale layers), the lower unit, ranges between 10 feet and 60 feet in thickness. The Fort Hays is overlain by the Smoky Hills chalk, 200 feet to 1,400 feet thick. The Niobrara is found at depths of 8,000 feet (northwest of Denver). It outcrops in central Kansas and eastern Nebraska, as it does in North Dakota and South Dakota.
A long production history
Geologists have studied the Niobrara for nearly a century and a half. But it wasn’t oil or natural gas that first caught their eye – it was chalk. During the 1870s, they discovered the immensity of fossil remains well preserved in the soft Niobrara chalk. Their detailed investigation led to commercial interest in the chalk as a source of Portland cement, which is used as a base in the manufacture of concrete. Chalk mines are currently still active in Nebraska and Colorado. (A kiln using Niobrara chalky shale also operated between 1899 and 1909 at Concrete, N,D,, in eastern Cavalier County.)
In 1876, oil was first observed seeping from the Niobrara just southwest of Colorado Springs. Wildcatters first hit oil in the Niobrara in the early 1920s and exploration and production started shortly thereafter in northwestern Colorado (Rio Blanco, Moffat and Routt Counties).
Niobrara discoveries were not made in the Denver-Julesburg Basin until the early 1950s. Activity picked up into the mid-1970s in Weld and Morgan Counties (just a short distance northeast of the Denver Metro area). Most of the oil produced came from parts of the Niobrara that have good natural permeability due to faulting and fracturing. Drillers used traditional vertical drilling techniques. Like the Bakken, the Niobrara is very tight and does not have good granular permeability (“granular permeability” referring to the interconnections between the tiny particles that make up rock units).
According to the U.S. Energy Information Administration (EIA), the Niobrara is ranked as having the 10th largest natural gas reserves in the United States. Natural gas has been produced in association with oil since the early years, however, in the mid-1980s – with the gradual federal deregulation of wellhead prices – exploration for natural gas ramped up, especially in Yuma County, 100 miles east of Denver on the Kansas state line. Here the Niobrara is fairly shallow and drillers have used vertical drilling with artificial fracturing to produce gas from the chalk. During this century’s first decade, more than 2,700 natural gas wells were drilled into the Niobrara.
Oil- and gas-bearing formations are characterized by a measure called “total organic carbon,” or TOC. It is simply the amount of carbon in a rock unit expressed as a percentage of the unit’s volume. The Niobrara’s TOC is generally less than 10 percent, with 1-4 percent being fairly typical. That compares to the Bakken’s TOC as high as 14 percent and generally above 10 percent. By way of comparison, the Utica shale in Pennsylvania averages about three percent. Similar to the Utica, however, the Niobrara’s thickness (up to 10 times that of the Bakken’s) makes up for its relatively low TOC.
Jake sets the pace
As with other tight plays around the country, horizontal drilling and hydraulic fracking have taken the Niobrara to a new level of exploration and production. In 2009, two Houston-based companies announced initial success with the formation’s first horizontal wells. EOG Resources’ “Jake,” a 7,000-foot well drilled in Weld County (the play’s sweet spot), just south of the Wyoming state line, produced an average of 555 barrels per day during its first three month of production. (EOG is the nation’s largest on-shore oil producer.) On Jake’s heels, Noble Energy announced “Gemini” – another Weld County well, which produced an average of 500 barrels per day through its first 60 days of production. Five years later, more than 30 companies have joined the Niobrara fray including Bigs such as Chesapeake Energy, Whiting Petroleum, Continental Resources and Anadarko Petroleum. According to EIA, the play’s production averaged 400,000 barrels of oil and five billion cubic feet of natural gas per day in February 2015.
A detailed assessment of the play’s recoverable reserves is still in the offing. However, industry analysts estimate the figure is between two and three billion barrels – compared to the Bakken’s 6.7 billion barrels. Current activity is hottest in Weld County, Colo., where more than 33,000 wells are now producing – the majority from the Niobrara. Activity is also strong across the Wyoming state line in Laramie County.
While small compared to Colorado, interest in the Niobrara in Kansas and Nebraska is gaining momentum. Exploration has been limited to counties bordering Colorado and Wyoming. Cheyenne County in Kansas; Perkins, Chase, Dundy, and Hitchcock Counties in Nebraska. Shallow gas production from the Niobrara in these counties has been ongoing for more than 40 years.
The Niobrara is getting attention in North Dakota as well. On June 20, 2014, Denver-based Strata-X Energy spudded its Rohweder #1-11, a proof of concept well in Emmons County. The well is part of the company’s Sleeping Giant Gas Project, which will target natural gas from the Niobrara. Strata-X has lease holdings on approximately 120,000 acres. The North Dakota Industrial Commission has granted the company three additional permits in Emmons and McIntosh Counties.
Strata-X subsequently announced the Rohweder results were encouraging. Drilled to 1,450 feet, the well showed gas over an 80-foot reservoir interval. Emmons County has been the site of previous drilling projects with disappointing results.