HEAVY IRON NEWS
The Best Shale Formation In North America
- By Design Team
- •
- 05 Jan, 2016
Though the oil and gas industry worldwide is suffering from the consequences of OPEC's price fixing, North America has managed to remain more stable than the other affected countries. Following the advances in shale gas recovery by hydraulic fracturing, and the rapid development of America's oil and gas industry, OPEC nations flooded the oil and gas market with cheap crude oil in order to drive out competition. For many countries, this is working; countries have resorted to purchasing these cheap oil barrels from OPEC and slowed down their own production, eventually leaving themselves at the whims of these oil producing nations. For America, and to a lesser extent Canada, it has not; North American oil producers may have been forced to slow operations, but they have refused to shut down.
THE GRANDE PRAIRIE SHALE FORMATION
With the tumultuous nature of the oil and gas industry, then, it's easy to see why there might be some oversights. In particular, the Grande Prairie area. The Grande Prairie region could potentially have enough in easily accessible oil reserves that North American companies could make a significant amount of money by plumbing its depths. Until now, North American companies have been able to maintain their profits through volume; they have been developing technologies to recover more from wells faster. But this alone will not help the market recover; in fact, quite the opposite. By continuing to supply oil and the low prices that OPEC has set, many of these oil and gas companies are merely holding on. Something would have to radically change in order for the companies to begin growing and making a profit once again.
Grand Prairie is located on the border between Alberta and British Columbia, located on top of a geological structure known as the Montney. Rough estimates guess that the Montney may hold up to 449 trillion cubic feet of natural gas, in addition to 1.125 billion barrels of crude oil. If North American oil and gas companies today are looking for sheer volume, the Montney is the place in which to do it. The problem is simple: the oil and gas industry is not prepared to grow right now or to make additional investments because most of them are suffering.
RECOVERING FROM LOW PER BARREL COSTS
Oil and gas companies will need to radically change their methods of production and recovery if they are to continue to grow and make a profit within the current market. Not only have per barrel prices been artificially lowered, but they are remaining at this low price point (and falling even lower) because more crude oil is being produced at that price point. For the market to stabilize or shift, North America will need to take more control over the market or will need to find even more readily accessible sources of oil.
Grand Prairie is currently sitting atop one of the world's best shale resources, but it's yet to be explored or taken advantage of. Instead, it remains an opportunity for investors who are willing to take a chance on the investment. For more information about the oil and gas industry, the equipment used throughout the oil and gas industry, and services and safety, contact Heavy Iron Oilfield Services LP today.
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