Bakken has a brother???
When gas
prices are high so is activity in the Rocky mountain basins. When gas prices drop activity and excitement subsequently drop in the western half of the U.S. This is primarily due to the low BTU content of most Rocky Mountain gas and its distance from U.S. markets. The Bakken thrives because it's an oil play.
In April, EOG announced that a successful horizontal well was drilled in northern Colorado that has produced an average of 555 barrels of oil per day. This production is from the Niobrara Shale. The Jake 2-01H is located in Weld County in the Denver-Julesburg Basin. At a depth around 7,000 feet this would compare favorably to the Bakken if reserve size are similar. Since the discovery EOG has leased more than 400,000 acres in northern Colorado and southern Wyoming. Furthermore, other players such as Anadarko, MDU resources, St. Mary Land & Exploration, Chesapeake, and others have also amassed sizable acreage positions.
The importance of this find is that the Niobrara is present in 5 western states. So the reserve volume could be huge as well as the economic impact to the Rocky Mountain states and the U.S. in general. We'll continue to watch production and other activity to see if the Niobrara is a close relative or a distant pretender to the Bakken.
