Another new oil formation potentially found

A crude-bearing cache known as the Birdbear, beneath North Dakota’s already booming oil patch, can be tapped using new technology that would expand horizontal drilling to parts of the state that have never seen it, geologists believe.

The Birdbear is a thin oil formation – only a few feet – locked within muddy limestone and dolomite more than 2 miles underground, immediately beneath the rich Bakken shale and Three Forks-Sanish formations in North Dakota, said Julie LeFever, a geologist with the state Geological Survey in Grand Forks.

“If the Bakken and Three Forks don’t work out, here’s another target,” LeFever said.

Denver-based Whiting Petroleum Corp. already has about 50 horizontal wells aimed at the Birdbear in Billings and Golden Valley counties in southwestern North Dakota, said John Kelso, a company spokesman. The wells there produce up to 400 barrels daily, compared with the company’s Bakken or Three Forks wells that can top 2,000 barrels daily, he said.

The formation in southwestern North Dakota is nearly identical to a Birdbear formation in Bottineau County, about 250 miles away in north-central North Dakota and just beyond the Bakken and on the far fringe of the state’s existing oil patch.

Rules would give more notice to landowners

North Dakota regulators are moving to strengthen oil production rules to give landowners more information about accidents and plans to reclaim their property when the oil pumping stops.

The proposed rules, which are likely to take effect next spring, would require oil rig operators to notify surface landowners about most accidents – such as an oil spill or salt water spill – that affect their land. Operators would have to provide copies of any reports about an incident to any affected property owner.

At present, a spill of more than one barrel, or 42 gallons, on an oil well site must be reported to the state Industrial Commission, which regulates North Dakota oil and gas production. Operators do not have to inform the surface landowner, although many do voluntarily, said Lynn Helms, director of the state Department of Mineral Resources.

The proposed rule specifies that the owner of land where an oil well is located – as well as any neighboring landowners whose property is affected by a spill’s spread – must be told about an accident.

N.D. coal-drying plant to test New Zealand lignite

A million pounds of New Zealand lignite is en route to a southwestern North Dakota plant designed to remove water from the low-quality but abundant coal.

Once processed at the unique, new drying plant near South Heart, the fuel will be shipped back to the Southwest Pacific nation in chunks the size of barbecue briquettes, weighing at least one-third less, burning cleaner and producing more energy, said Robert French, the chief executive officer of GTL Energy USA Ltd.

Plentiful in North Dakota and other parts of the world, lignite can be used to fuel electric power plants. But it usually has a moisture content of 30 percent to 60 percent, meaning it is heavier and more costly to transport than other forms of coal.

Fargo company proposes diesel plant near Williston

A Fargo company is seeking investors for a plant in northwestern North Dakota that would make diesel fuel to help run drilling rigs in the state’s oil patch, but one oil industry official said it might be a risky business. Mike Wavra, president of Dakota Oil Processing LLC, said his company wants to build the plant near Trenton, a town of about 100 people a few miles southwest of Williston. It would cost at least $180 million and provide more than 50 jobs in the area, he said.

The so-called diesel topping facility – a sort of mini refinery – would be built at the site of an abandoned natural gas plant, Wavra said. The factory could produce up to 567,000 gallons of diesel daily, using crude from the rich Bakken and Three Forks wells in the region, he said.

The diesel could be sold to farmers and oil companies in eastern Montana and western North Dakota, Wavra said. Diesel has been in demand with the boom in North Dakota’s oil industry. One rig can use up to 2,000 gallons daily.

“We have commitments from producers to supply crude,” Wavra said. “It sure seems like a good fit.” (Energy briefs compiled from stories by The Bismarck Tribune and The Associated Press.)